South Korean AI infrastructure company Elice Group sank 37% below its initial public offering price during its stock-market debut on Tuesday, as concerns over the sector’s investment outlook overshadowed strong demand for the share sale.
The stock traded at 57,000 won at 2:10 p.m. Seoul time on the Kosdaq market, compared with its offer price of 90,500 won, according to Business Watch. It had opened at 75,700 won, already a 16.4% discount.
Elice raised 201.1 billion won, or about $150 million, through the offering. Its shares were priced on October 6, before the recent selloff in AI-related stocks, Reuters reported. The decline adds to signs of weakening investor appetite for companies building the computing infrastructure behind artificial intelligence.
The trading performance marked a sharp reversal from the IPO’s reception. Institutional orders amounted to about 389 times the shares available, while the retail portion attracted subscriptions of roughly 408 times and about 10.26 trillion won in deposits.
The debut comes as investors scrutinize the financing requirements and potential returns from AI infrastructure spending. Australia’s Nvidia-backed Firmus shelved its planned listing this month, while Blackstone-backed AirTrunk postponed a Singapore real estate investment trust IPO, according to Reuters.
Founded in 2015, Elice operates across AI cloud infrastructure, cloud services and education and enterprise software. Its business includes modular data centers and platforms for managing graphics processing units, the chips used to train and run AI models.
In a September 30 statement outlining its listing plans, Elice said proceeds would support regional data center expansion in South Korea and overseas growth. The company plans to target locations outside the Seoul metropolitan area where power connections are available, while pursuing modular data-center exports through its operations in the US, Japan and Singapore.
Elice reported first-half revenue of 34.4 billion won and operating profit of 10.3 billion won in that statement. Revenue for the six months amounted to about 87% of the previous full year’s total, underscoring the growth that helped underpin its pitch to investors.