Foreign Media Spotlight Elice's First-Day Plunge... "Skepticism Over AI Investment Grows"

Concerns over recouping investment costs rise.

After Korean AI infrastructure company Elice Group fell more than 32% below its IPO price on its first day of trading on the KOSDAQ, major international news outlets reported the debut as an example of growing market wariness toward investment in AI infrastructure.

On October 20 local time, Bloomberg described Elice's sharp first-day drop as a sign of weakening investor confidence in neocloud companies. It said Elice, which had been little known outside South Korea, had become a focal point in the debate over AI company valuations and whether their actual performance could meet market expectations.

Bloomberg also noted that Elice's first-day performance had heightened concerns about whether companies that have invested massive amounts of capital in building AI infrastructure will be able to recoup those costs.

Another international outlet described the South Korean stock market as a "barometer" of global sentiment toward AI investment and focused on the impact of Elice's plunge across global markets. Australia's Permus Grid withdrew its IPO, while AirTrunk postponed its listing.

U.S. financial magazine Barron's also highlighted Elice's sharp first-day drop, saying that despite rapid revenue growth and a return to profitability, its high valuation, large-scale capital expenditures, and concerns about future profitability had curbed buying.

Earlier, U.S. company CoreWeave drew attention as an example of the financing burden facing AI infrastructure companies. The yield on CoreWeave bonds maturing in 2031 recently topped 15%, and the prices of some bonds fell below 80% of face value.

One international outlet reported that CoreWeave's debt had reached about $50 billion, and that the company's model of spending heavily upfront on data centers and then taking time to recoup those costs was fueling investor concerns.

Against this backdrop, Elice's sharp first-day drop is seen as further fueling concerns about uncertainty over when AI capital expenditures will translate into stable profits.

This content was produced with the assistance of AI translation services.