In today’s briefing:
- Read-Through on the Samsung/Hynix ADR-Listing Noise
- A Potential Listing of ADRs for SK Hynix Using Its Treasury Shares?
- More Detailed Insight into Hynix’s Internal Situation Regarding the ADR Issue
- A Pair Trade Between Coupang (Short) And CJ Logistics (Long)
Read-Through on the Samsung/Hynix ADR-Listing Noise
- ADR odds are tiny. Both Samsung and Hynix have thin control stakes, making governance risk too high. Neither is willing to chase a valuation pop at the expense of stability.
- Still can’t ignore it, since the ADR chatter is meaningfully swinging the pair trades. Samsung pref spread and Hynix/Square are both getting pushed around.
- ADR noise cooled today, but it can easily resurface and skew the setup. Treat as noise, but be ready to hit aggressive reversion trades when it pops again.
A Potential Listing of ADRs for SK Hynix Using Its Treasury Shares?
- According to numerous local media, SK Hynix is considering on listing its treasury shares (2.4% of outstanding shares representing 17.4 million shares) as ADRs.
- SK Hynix could cancel its treasury shares or list them as ADRs. The bigger bang for the buck will likely be to list them as ADRs.
- By listing its shares as ADRs, the valuation gap between SK Hynix and other listed peers (such as MU and TSMC) could be reduced.
More Detailed Insight into Hynix’s Internal Situation Regarding the ADR Issue
- They’re maxing out M15X ahead of schedule, facing a fab gap until ’27, and now need more capex than their KRW 28tn cash pile comfortably covers.
- SK doesn’t want an Hynix ADR; they’re focused on tapping the KRW 150tn Growth Fund to fill the capex gap while avoiding dilution and protecting their already-fragile control stack.
- ADR noise spiked because Hynix’s near-term capex needs exceed Growth Fund capacity, pushing them toward a 2.4% treasury dump—but I still don’t see SK pulling the ADR trigger.
A Pair Trade Between Coupang (Short) And CJ Logistics (Long)
- In this insight, we discuss a pair trade between Coupang (CPNG US) (short) and CJ Logistics (000120 KS) (long).
- There are six major factors that have negatively impacted Coupang in the past several weeks including a massive data breach, loss of customers, and potential ban on early dawn deliveries.
- Coupang’s daily active users (DAU) were 16.2 million as of 5 December, down by 1.8 million (10%) from 18 million as of 1 December.
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