Five penny stocks face delisting under tougher rules

Five listed firms face delisting, as their stock prices have failed to meet tougher listing requirements, according to data from the Korea Exchange (KRX) on Thursday.

The tougher rules were implemented in July to remove penny stocks as financial authorities moved to delist distressed companies, long seen as a drag on the local stock market.

Under the rules, a listed firm will be forced onto a delisting roster if its stock price falls below 1,000 won ($0.75) per share for the 45th consecutive trading session after authorities warn it about its poor performance.

The five listed firms — TKG Aikang, Nuintek, Hyungji Global, Barunson Entertainment & Arts and i-Scream Edu — were warned over penny stock status on Aug. 13.

When the KRX issues a public notice about the five firms’ delisting , it will be the first case of penny stocks being removed from the market under the system.

In a bid to reinvigorate the Kosdaq market, the KRX also plans to implement a two-tier segmentation system in the secondary stock market starting next year.

According to the proposed plan, the listed firms on the Kosdaq will be divided into two segments: the premium sector for heavyweights and another for underperforming firms.

Yonhap