KOSDAQ-listed stocks flagged the previous day for possible watch-list designation extended their losses, as delisting risk soured investor sentiment. The stocks were designated as issues for administrative watch after their share prices stayed below 1,000 won for 30 consecutive trading sessions.
As of 1:30 p.m. on the 13th, Woori Enterprise traded at 640 won, down 139 won, or 17.84%, from the previous session, according to the Korea Exchange (KRX). The company, whose main businesses are lighting and biotechnology, was placed under watch for failing to meet the minimum share-price threshold. Other stocks designated for watch status alongside Woori Enterprise also fell, including TKG Aegang (-4.93%), Sharpeon (-11.89%), JMI (-5.81%), Inno Instrument (-10.02%), S-Energy (-7.11%) and Labgenomics (-6.60%).
The KRX said that watch-list designation grounds arose the previous day for 36 companies listed on the main KOSPI board and the KOSDAQ, as part of tighter delisting rules aimed at quickly removing troubled firms. Since the first of last month, a company is placed under watch if its share price stays below 1,000 won for 30 straight trading sessions or falls short of the minimum market-capitalization requirement. If it then fails to meet the standard for 45 consecutive sessions out of the following 90, the stock is delisted. Three KOSPI companies and 21 KOSDAQ companies were designated for watch status after their share prices fell below 1,000 won.
Companies facing possible delisting are working on measures to shore up their positions. Among KOSPI-listed firms, Juyoung Tech and Ascendio carried out rights offerings, while SH Energy & Chemical continued executive purchases of the company's own shares. KOSDAQ-listed firms including Sejin T&S, Yukil C&S and KM Pharmaceutical also decided to buy back their own shares. Still, some analysts say the companies may lack the capacity to respond, as the number of newly designated watch-list stocks could expand to around 100.
