Kioxia US Listing Could Boost Global AI Fund Interest
Japanese chipmaker Kioxia, whose shares have surged 456% this year, announced plans in May to list American Depositary Shares (ADS) to broaden its investor base. This move could attract major AI-focused funds.
Kioxia Eyes US Market for Liquidity
Japanese chipmaker Kioxia is preparing for a US share listing, a move that could significantly elevate its profile among global investors. Sebastian Thomas, a portfolio manager with Voya Investments, suggested the listing could bring the company back into the global investment spotlight.
Kioxia's shares have already seen a substantial 456% increase this year, making it a top performer on the benchmark Nikkei 225 index. The company stated in May that it was preparing to list American Depositary Shares (ADS) to expand its investor base.
Voya's Strategy and Liquidity Needs
Voya Investments, which manages a $14 billion fund focused on artificial intelligence (AI), currently does not hold Kioxia shares. This fund, which includes $5 billion from Japanese investors, also excludes other technology firms that have driven recent gains on the Nikkei. Mr Thomas cited liquidity as the primary reason for these exclusions.
He noted that trading in the US market could change this dynamic, referencing South Korea's SK Hynix, which saw improved liquidity after its Nasdaq listing in July.
Addressing Japanese Market Access
Mr Thomas highlighted a broader challenge for investors seeking to engage with Japanese companies, particularly those within the supply chain. He observed many interesting firms in Japan lack sufficient liquidity to accommodate significant investment. Voya's strategy generally favours larger and more liquid companies.
While Voya does not hold Kioxia, it has invested in other memory makers, including SK Hynix and Micron Technology. Mr Thomas explained that US listings simplify the entry process for funds like Voya into these companies.
Kioxia's pursuit of a US listing offers a pathway for global funds, such as Voya, to access high-performing Asian technology companies with increased liquidity. This approach could encourage other Japanese or broader Asian firms, especially those in critical supply chains, to consider similar listings.
Enhanced liquidity through US market access would allow larger institutional investors to participate more readily, potentially driving further capital inflows into the Asian technology sector and its key players.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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