SK Hynix Inc. (SKH.N, 000660.KS) has drawn a second exchange caution from South Korea's stock market regulator due to an unprecedented stock rally, with shares rising over 28% in just five trading sessions. The move signals growing regulatory scrutiny over potential market distortions.
- SK Hynix shares rose 28.3% in five trading sessions from December 2 to December 7, 2025
- Market cap surpassed $120 billion, marking a record high for the company
- Second exchange caution issued by the Korea Exchange (KRX) within two months
- Stock trades at a forward P/E of 22.5, above its three-year average of 15.8
- Foreign ownership stands at 41.2%, raising concerns over leverage and market stability
- KRX cautions often precede trading halts or intensified surveillance
SK Hynix's stock has surged to a new all-time high, gaining 28.3% since December 2, 2025, following strong earnings reports and rising demand for advanced memory chips. The company's market capitalization now exceeds $120 billion, making it the most valuable semiconductor firm in South Korea. This sharp rise triggered a second exchange caution from the Korea Exchange (KRX), a formal warning issued when price movements deviate significantly from fundamentals or suggest abnormal trading activity. The exchange caution, which follows a similar notice in early November 2025, underscores concerns about speculative trading and possible manipulation in the semiconductor sector. The KRX has previously used such warnings as precursors to temporary trading halts or enhanced surveillance, particularly in high-volatility stocks. Analysts note that the rally has outpaced broader market gains and fundamentals, with the stock trading at a forward P/E ratio of 22.5—well above its three-year average of 15.8. Market participants, including institutional investors and margin traders, are closely monitoring the situation. The caution may prompt increased risk assessments and hedging strategies, especially in tech-heavy indices. Foreign ownership of SK Hynix shares, which rose to 41.2% in November, has also drawn attention amid fears of excessive leverage and capital flight risks if the rally reverses. The semiconductor sector, already under pressure from inventory adjustments in the global PC and data center markets, now faces heightened scrutiny. SK Hynix’s peers, including Samsung Electronics and Micron Technology, have seen modest gains, but none as pronounced. The company's earnings guidance for Q4 2025 remains strong, predicting a 15% increase in revenue from memory sales, but analysts warn that the stock's current valuation may not be sustainable without further momentum.