Retail investors bet on AI infrastructure rebound, shares of South Korean cloud operator Elice rise above IPO price in two days

Shares of South Korean cloud service provider Elice have risen for two consecutive days, recovering its IPO price for the first time, indicating that some investors are still betting on the long-term prospects of the AI infrastructure sector—even though divisions surrounding this sector remain sharp.

On Thursday, Elice’s shares rose as much as 25% intraday, reaching 99,900 won per share, climbing above its IPO price of 90,500 won for the first time. The previous day, the stock had already hit its daily limit up, closing 30% higher in a single day.

The main driving force behind this rebound came from retail investors. According to data compiled by Bloomberg, South Korea’s popular retail trading platform Kiwoom Securities recorded the largest buy orders that day; on another popular retail trading app Toss Securities, Elice ranked among the top ten in trading volume, alongside Samsung Electronics and SK Hynix.

However, doubts remain about the sustainability of this rebound. Korean chip giants Samsung Electronics and SK Hynix both fell that day, the Korea Composite Stock Price Index (Kospi) was under overall pressure, and Elice also gave back some gains intraday, hovering near its IPO price. The fragile market sentiment reflects investors’ deep uncertainty about the AI infrastructure sector.

Elice’s IPO has been a rollercoaster. After raising 20.1 billion won (about $152 million) on the Korean market, its shares plunged 32% on the first day of trading last Tuesday—a clear sign that investors are concerned about whether AI infrastructure companies can sustain growth under high levels of debt.

This concern resurfaced on Thursday. US tech stock earnings signals were mixed, and escalating geopolitical tensions in the Middle East further dampened risk appetite across Asian markets, with the overnight Wall Street rally barely boosting regional confidence.

Ahn Hyunsang, CEO of Korea Investment Research, said that Wednesday’s limit-up rally could further stimulate retail investors, attracting more bets on another surge.

However, institutional investors remain noticeably more conservative.

Gary Tan, portfolio manager at Allspring Global Investments, said: “Although Elice’s second-day rebound is encouraging, we believe the market’s overall sentiment toward new cloud services remains cautious, and as funding sources become more selective, this sector may continue to experience volatility. Equity investors’ focus has moved beyond headline order sizes to execution capability, financing resilience, and the underlying quality of operations.”

Elice’s share price rollercoaster over the past week reflects deep division among investors regarding the sustainability of the AI infrastructure sector. The clear contrast between positive retail sentiment and institutional caution, along with the mixed earnings signals from tech giants such as Tesla and Meta, has contributed to overall market hesitation.

As the funding environment becomes increasingly selective, whether new cloud service providers can strike a balance between high capital expenditures and profitability will be the key factor determining whether this sector can continue to attract capital.