Korea Exchange designates 36 companies as administrative issues

The Korea Exchange has designated 36 listed companies as administrative issues following the implementation of strengthened delisting regulations. This marks the first major application of new rules designed to expedite the removal of insolvent firms from the market.

Of the 36 companies, 30 are newly designated. The majority, 24 firms, were flagged as ‘penny stocks’ because their share prices remained below 1,000 KRW for 30 consecutive trading days. Additionally, nine companies failed to meet the updated market capitalization requirements, which recently increased to 30 billion KRW for KOSPI and 20 billion KRW for KOSDAQ.

Under the new rules, companies designated as administrative issues must exceed the required price or capitalization thresholds for at least 45 consecutive days within a 90-day period to avoid delisting. Industry representatives have expressed concerns that using a 1,000 KRW price floor as a primary indicator of insolvency is excessive, arguing that stock prices can fluctuate due to market conditions regardless of a company's actual growth potential.