Blacklisted and delisted stocks on the rise in Korea amid unfavorable market conditions

[Source: Korea Exchange]

More Korean stocks are being blacklisted and delisted amid the worsening investment environment.

According to South Korea’s sole stock exchange operator Korea Exchange (KRX) on Monday, a total of 102 stocks are on the watch, including 12 on the country’s primary Kospi and 90 on the Kosdaq.

Most of them were put under surveillance since last year – 38 this year, 23 in 2021, and 24 in 2020.

Stocks under surveillance are at risk of delisting if company performance continues to deteriorate and capital base worsens.

The number of stocks under surveillance, the step before delisting, rose when delisting standards were toughened in 2019.

Companies are usually given multiple grace periods when they receive adverse or disclaimer opinions.

Still more are being kicked out.

This year, 25 stocks were delisted, nearing doubling from 13 last year.

Stock prices fall if they go on the watch list.

Shares of Asia Seed Co., South Korea's leading developer and supplier of vegetable seeds, fell 22.14 percent on the day it was put under surveillance for refusing to receive an audit opinion and dropped 6.86 percent the next day as well.

Shares of Il Jeong Industrial Co., an industrial fiber company, also plunged 20.21 percent the day after it was placed under surveillance on March 24.

[ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved]