South Korea's Elice plunges about 30% on its debut as AI jitters return to markets

Shares in South Korean AI services company Elice Group tumbled about 30% in their market debut on Tuesday, 20 October, falling well below the IPO price of 90,500 won, CNBC and Reuters reported. Yonhap said the stock closed at 61,500 won, down 32% from the offer price.

What Elice does

Elice raised 201.1 billion won (about $150 million) in the offering. It provides AI cloud services and AI-based education and business software, and plans to spend most of the money on portable modular data centres and related infrastructure. The IPO had drawn institutional orders worth 388.84 times the shares on offer, but analysts noted it was priced on 6 October, before the latest sell-off in AI stocks.

“Elice’s debut shows the AI infrastructure trade has moved from ‘build at any cost’ to ‘who is paying and for how long’,” Ke Yan of Shenton Research told CNBC. Other data-centre firms, including Australia’s Firmus, AirTrunk and SoftBank’s SB Energy, have shelved listing plans this month, CNBC noted.

Wall Street on edge

The weak debut weighed on sentiment worldwide. Nasdaq 100 futures were down about 0.6% in early US trading on Tuesday, while S&P 500 futures slipped 0.2% and Dow futures edged up, Reuters reported. CoreWeave fell 4.7% and Nebius 4.9% before the opening bell, after a brief rebound in tech stocks on Monday. Brent crude stayed near a five-month high, AP and Reuters said.

Investors are now waiting for quarterly results from SpaceX and Netflix after Tuesday’s close, and from Meta and Tesla on Wednesday.