Ellis Group shares hit daily limit on day two after 32% drop on Kosdaq debut
In short
Ellis Group (엘리스그룹), an AI infrastructure company, closed its 20 October Kosdaq debut about 32% below its offer price of 90,500 won. On 21 October its shares rose 29.92% to the daily limit of 79,900 won, still 11.71% below the offer price. Foreign outlets had read the first-day fall as a sign of investor worry about AI spending.
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Ellis Group (엘리스그룹), a Korean AI infrastructure company, saw its shares rise 29.92% to the daily limit of 79,900 won on 21 October, its second day of trading on the Kosdaq. Yonhap reported that the stock opened up 13.01% and reached the limit at about 09:12. Seoul Shinmun said it stayed at that level to the close, which Yonhap also reported. The price remained 11.71% below the offer price, according to Seoul Economic Daily and Seoul Shinmun. [ 3 , 5 , 7 , 10 ]
The rebound followed a steep fall on 20 October. Ellis closed its debut day at 61,500 won, 32.04% below the 90,500 won offer price, according to Newsis, Yonhap and Seoul Shinmun. Korea Economic Daily gave 61,600 won, a 31.93% drop. Chosun Ilbo's opening line described a 20% fall, while the same article later said 30%. [ 1 , 2 , 4 , 5 , 10 ]
Foreign outlets took note of the debut, according to Korean reports. Bloomberg said on 20 October (local time) that the fall showed weakening confidence in 'neocloud' companies, meaning those that run data centers specialized for AI computing. It also said the company, little known outside Korea, was at the center of a debate over AI valuations. Reuters was reported to have said the fall revived worries about the sustainability of AI infrastructure spending and about payback periods. CNBC was reported to have said the fall spread to U.S. data-center stocks and that the offering was only $150 million. [ 1 , 2 , 3 , 9 , 10 ]
Newsis and Yonhap said the fall also affected New York trading. Seo Sang-young of Mirae Asset said Ellis is regarded in Korea as the neocloud company most similar to U.S. CoreWeave. Yonhap said CoreWeave fell more than 6% early and then turned higher, closing up 1.65%, and that other affected stocks narrowed their losses or rose. Seoul Economic Daily said Nebius and Iren were weaker in the morning. Yonhap said the recovery appeared to reflect a view that market worry about neocloud credit risk had been excessive. [ 3 , 4 , 5 ]
Seoul Shinmun linked the rebound to bargain buying after a view that the previous day's fall was excessive, and to a U.S. market rebound. Ko Tae-bong of iM Securities was quoted as saying AI stock prices depend heavily on sentiment. The paper reported that the Kospi closed up 3.29% at 5735.66 and that a buy sidecar was triggered. It also said that Nvidia-backed Firmus had cancelled its IPO and that Blackstone-backed AirTrunk had postponed a Singapore listing. [ 10 ]
Chosun Ilbo reported that the retail subscription, held on 7-8 (month not stated), drew a 408-to-1 competition rate and about 10.26 trillion won in subscription deposits. Founded in 2015, Ellis offers AI computing infrastructure, cloud services and AI transformation solutions. It reported 39.5 billion won in consolidated revenue and 5.2 billion won in operating profit last year, and 34.4 billion won and 10.3 billion won in the first half of this year. Korea Economic Daily said proceeds are planned for modular data centers and related infrastructure. [ 1 , 2 ]
On 22 October, Newsis reported Ellis up 23.09% at 98,350 won at 10:03, and Yonhap's headline at 10:12 said it was up 21%. Newsis said buying by 'other corporations' appeared to have driven the gain. [ 11 , 12 ]
Why it matters
Korean outlets say the debut was followed abroad as a gauge of investor sentiment toward AI infrastructure companies, and that it briefly weighed on U.S. AI-related stocks. Outlets also note that the sharp swings leave open how quickly AI firms can recover their investment.
Key facts
- Ellis closed its first day on the Kosdaq on 20 October at 61,500 won, 32.04% below the 90,500 won offer price, according to Newsis, Yonhap and Seoul Shinmun. [ 4 , 5 , 10 ]
- On 21 October the shares rose 29.92% to the 79,900 won daily limit and stayed there to the close, according to Seoul Shinmun. [ 1 , 3 , 4 , 5 , 10 ]
- Even at the limit-up price, the stock remained 11.71% below the offer price. [ 3 , 10 ]
- Retail subscription on 7-8 (month not stated in the documents) drew a 408-to-1 competition rate and about 10.26 trillion won in subscription deposits. [ 2 ]
- Bloomberg reported on 20 October (local time) that the debut showed weakening investor confidence in 'neocloud' companies, which run data centers specialized for AI computing. [ 1 , 2 , 3 , 10 ]
- CNBC described the offering as $150 million in size, according to Korea Economic Daily and Seoul Economic Daily. [ 1 , 3 ]
- On 22 October the shares were up a further 23.09% at 98,350 won at 10:03, according to Newsis. [ 12 ]
Confirmed by several sources
- Ellis fell by more than 30% on its first trading day, 20 October, on the Kosdaq. [ 1 , 3 , 4 , 5 , 10 ]
- On 21 October Ellis rose 29.92% to 79,900 won, the daily limit, but remained below its 90,500 won offer price. [ 1 , 2 , 3 , 4 , 5 , 10 ]
- Foreign media, including Bloomberg, Reuters and CNBC, covered the first-day fall as a sign of concern about AI investment and valuations. [ 1 , 3 , 10 ]
- Mirae Asset analyst Seo Sang-young said Ellis is regarded in Korea as the neocloud company most similar to U.S. CoreWeave, and that its fall affected sentiment in New York. [ 4 , 5 ]
- CoreWeave fell more than 6% early on 20 October (U.S. time) and then turned higher. [ 3 , 5 ]
Still unclear
- The exact first-day closing price: 61,500 won or 61,600 won. Newsis, Yonhap and Seoul Shinmun give 61,500 won (down 32.04%); Korea Economic Daily gives 61,600 won (down 31.93%).
- The size of the first-day fall. Chosun Ilbo's opening line says 20%, but later in the same article says 30%; other outlets say about 32%.
- Why the shares rose on 22 October. Newsis, a single source, says buying by 'other corporations' (기타법인) appeared to have driven it; the interpretation is not confirmed.
- Whether worries about AI investment have eased. Seoul Shinmun says the one-day rise does not mean the anxiety has gone and cites industry views that recovery depends on how fast invested money is recouped.
What local media are saying
Timeline, local time
- On 21 October Ellis entered the limit-up price, according to Yonhap. [ 5 ]
- Ellis traded at 79,900 won, up 29.92%, per Korea Exchange data cited by Seoul Economic Daily. [ 3 ]
- Yonhap reported that Ellis closed at the limit-up price on its second day. [ 7 ]
- On 22 October Ellis traded at 98,350 won, up 23.09%, per Newsis. [ 12 ]