South Korean memory giant SK Hynix's stock price fell more than 7% during intraday trading today (13th). This follows the company's American Depositary Receipts (ADR) debut trading last Friday, which closed up 13% in the U.S. stock market.

The Korean Kospi index dropped about 3% during intraday trading, while Japan's Nikkei 225 index fell by 0.37%.

Korea Investment & Securities predicts that SK Hynix's operating profit for the second quarter may be 8% lower than market consensus, due to the company's revenue from high-bandwidth memory (HBM) being higher than its peers, which limits the growth potential of its average selling price.

Jason Minsang Kam, head of active equity management at Kyobo Life Insurance in Seoul, stated: "Historically, large global companies like TSMC have typically had a structural valuation gap of about 15% between their locally listed stocks and ADRs, mainly due to exchange rate factors and differences in regulatory systems."

He noted that since the upward momentum in the U.S. market has already been reflected in the stock price, SK Hynix's stock may face significant intraday profit-taking pressure and the unwinding of arbitrage trades, leading to a price trend that may open high and then retreat, leaving a long upper shadow, ultimately resulting in a reduced closing gain.

Kam said, "SK Hynix's vision of transforming memory through HBM into 'customized solution services' is a strong long-term investment theme. However, as Morgan Stanley and other major investment banks have warned, memory is inherently still a cyclical commodity."

According to data compiled by Bloomberg, SK Hynix's ADR traded last Friday at about a 15% premium compared to its stocks listed in Seoul