Seoul:Five firms listed on the Korea Exchange (KRX) are at risk of being delisted due to their stock prices failing to meet recently implemented tougher listing requirements.
According to Yonhap News Agency, the stricter regulations were introduced in July as part of efforts by financial authorities to eliminate penny stocks from the market. These stocks, often seen as a burden on the local stock market, are subject to delisting if their prices remain below 1,000 won (US$0.75) per share for 45 consecutive trading sessions after being warned for poor performance.
The affected companies, TKG Aikang, Nuintek, Hyungji Global, Barunson Entertainment and Arts, and i-Scream Edu, received warnings regarding their penny stock status on August 13. Should the KRX issue a public notice confirming their delisting, it would mark the first instance of penny stocks being removed under the new system.
Additionally, the KRX plans to introduce a two-tier segmentation system in the KOSDAQ market next year. This plan aims to divide listed firms into two categories a premium sector for leading companies and another sector for underperforming firms.