South Korean AI Infrastructure Firm Ellis Group Shares Plunge 32% on First Day of KOSDAQ Listing

South Korean artificial intelligence infrastructure company Ellis Group (엘리스그룹) experienced a poor debut on the KOSDAQ market on October 20, 2026, closing at 61,500 won, a 32.04% drop from its issue price of 90,500 won. During intraday trading, the decline reached as much as 37.57%. This performance contrasts sharply with the intense pre-listing demand, which saw an institutional competition ratio of 388.84:1 and retail subscription deposits exceeding 10.25 trillion won.

Founded in 2015, Ellis Group started with an AI education platform before expanding into AI cloud and data services. The company is promoting a "Neocloud" business model, offering integrated services from AI infrastructure construction to cloud operations, leveraging technologies such as its modular AI data center "AI PMDC" and GPU virtualization. Although the company reported revenue of 34.4 billion won and operating profit of 10.3 billion won for the first half of the year—surpassing its full-year operating profit from the previous year—the market appears more focused on the uncertainties surrounding its heavy capital expenditures.

The share price decline reflects a broader reassessment of valuation logic within the AI infrastructure sector. Market commentary suggests that beyond profit-taking due to high IPO pricing, concerns regarding global peers like CoreWeave—stemming from massive equipment investments and profitability issues—have dampened investor sentiment toward related stocks. With AI data center construction requiring substantial funding, the payback period and actual revenue generation have become critical evaluation criteria. While Ellis Group plans to use IPO proceeds to expand domestic AI data centers and enter overseas markets, its stock performance indicates that growth expectations alone are no longer sufficient to support high valuations, as investors shift focus to concrete cash flow and profitability paths.