US investors will soon get access to SK Hynix, another memory maker riding the AI boom

South Korean memory chip maker SK Hynix, rival to Samsung and American Micron, plans to sell almost 17.8 million shares in a US initial public offering. said Monday. Should the shares sell well (and there are indications that they will), the company could raise about $28 billion, based on SK Hynix’s closing price last Friday in Seoul. Bloomberg reports.

SK Hynix will offer American Depositary Receipts (ADRs), a type of certificate that allows US investors to buy foreign stocks without trading directly on a foreign exchange. Each ADR represents one-tenth of an ordinary share. The price of these securities is expected to be determined on Thursday and trading will begin on Friday.

Like Micron, SK Hynix is ​​experiencing an AI-driven boom that is attributed to AI in both sales and stock price. First-quarter sales were up nearly 200% from the same quarter last year, and shares are up about 260% so far this year. This is because systems running AI are very memory intensive. As hyperscalers like Amazon, Microsoft, Google, and Oracle rush to build so-called AI factories, and the number of new AI data centers proliferates nationwide, demand is outpacing supply, creating a shortage of memory chips, including high-bandwidth memory chips (HBM), DRAM, and NAND (the various types of chips that store and move data within AI systems). The situation is called ‘RAMageddon’. Apple executives say the shortage is forcing the company to raise prices for Mac computers and iPads.

South Korean tech companies, led by SK Hynix and Samsung, have pledged to spend more than $550 billion building new manufacturing capacity to keep up. That’s actually a risky business. By the time these facilities are built, memory needs for AI may change, leaving more supply than the market wants and potentially driving down prices. But for now, Wall Street is looking for another Nvidia, and memory chip makers are among the best options they have.

Micron, the closest U.S. comparison, has soared nearly 700% in the past year to a valuation of more than $1 trillion, fueled by record AI-driven memory demand and revenue.