Korean exchange considers dividing Kosdaq into segments — Korea Herald
The Korea Exchange (KRX) is considering introducing a multi-tier system for South Korea's Kosdaq market to distinguish companies with stronger performance from other issuers. As reported by the Korea Herald, the system may be launched no earlier than the second half of 2027, after companies disclose their annual financial results.
Segments for companies
KRX is studying the division of companies whose shares are listed on Kosdaq into upper and lower segments. The upper segment may preliminarily be called the Select Segment. It is expected to include companies that meet quantitative criteria, including those related to financial results.
The model partly follows the structure of the U.S. Nasdaq exchange, where three listing tiers have operated since 2006: the Global Select Market, Global Market and Capital Market. The Korean exchange is considering premium, standard and supervisory segments with separate requirements for admission and maintaining a listing.
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The premium segment is intended for large, mature companies. The criteria under consideration include market capitalization, revenue, profit and corporate governance. The standard segment may include companies at the growth stage; for them, KRX is also studying expanded disclosure of development plans, profit forecasts and preliminary results.
Risks for lower segments
Companies facing delisting or having trading risks may be placed in a separate supervisory segment. The exchange does not plan to set a fixed number of issuers in the upper segment: initially, it may include about 10% of Kosdaq companies, and this share is intended to be increased to 30% later.
KRX expects to define the detailed requirements after companies publish their annual results in April 2027. The exchange also recognizes the risk of capital concentration in the upper segment, which could make fundraising more difficult for other companies. Possible support measures under consideration include government funding and investment incentives, but specific mechanisms, including tax benefits, have not yet been determined.
