SEOUL, South Korea: SK Hynix's U.S.-listed shares surged 14 percent in their Nasdaq debut on July 10 after the South Korean chipmaker completed a US$26.5 billion share sale, underscoring continued investor confidence in companies benefiting from the artificial intelligence boom.

The debut comes despite a recent pullback in semiconductor stocks following a prolonged rally fueled by soaring demand for AI infrastructure.

SK Hynix's shares have fallen about 25 percent from the record high reached two weeks ago, but the stock remains roughly 630 percent higher than a year earlier.

"Global semiconductors is the most crowded trade in the world right now," said Thomas Hayes, chairman at Great Hill Capital in New York.

"The bankers and the issuer, in this case SK Hynix, are meeting demand where it is. They're seeing excessive valuations, and they want to take advantage of it."

The company's American Depositary Receipts (ADRs) opened at $170 per share, compared with the $149 offer price and at a 2.7 percent premium to the average share price over the previous three trading days in Seoul. Ten ADRs represent one common share.

"Demand for the US share sale has been stronger than some people might have expected. That implies the memory chip rally might have just taken a breath rather than peaked," said Dan Coatsworth, head of markets at AJ Bell.

The offering, the second-largest U.S. share sale after SpaceX's record IPO last month, will fund new manufacturing facilities while giving SK Hynix direct access to the world's largest investor base. A source told Reuters the offering was more than seven times oversubscribed.

The Icheon-based company is the world's largest producer of high-bandwidth memory (HBM) chips, a key component used in AI-focused graphics processing units made by companies including Nvidia and AMD.

"This is the purest large-cap way for U.S. investors to own the AI-memory theme, and Hynix deliberately picked Nasdaq to tap that demand and the higher valuations U.S. chip names command versus Seoul," said Giuseppe Sette, co-founder of investment analysis platform Reflexivity.

Analysts said the U.S. listing could help narrow SK Hynix's valuation gap with rival Micron by expanding its investor base.

However, some market watchers cautioned that questions remain about whether technology companies' massive AI infrastructure spending can be sustained over the long term.

"Investors will weigh the strength of the past year's rally against this latest volatility ... Oversupply fears are inherent to the industry," said Matt Kennedy, senior strategist at Renaissance Capital.