KONEX, Branded a Third-Division Market: Will 'Transfer Listing Before Delisting' Be Its Savior?

[Financial News] KONEX trading value has fallen to its lowest level since the market's revitalization, while the number of companies transferring their listings to KOSDAQ has also dropped sharply. The market is going through a downturn. KONEX is hoping that the recently introduced allowance for companies facing delisting to transfer their listings to KONEX will help revitalize the market.
According to Korea Exchange (KRX) on the 27th, KONEX's average daily trading value stood at KRW 1.1 billion from the beginning of this year through the 23rd. That was the lowest level on record since the government launched efforts to revitalize the KONEX market in 2015.
KONEX's average daily trading value reached a record high of KRW 7.4 billion in 2021, fueled by a stock market boom and enthusiasm for biotech and technology stocks, but has continued to decline since then. The figures were KRW 2.2 billion in 2022, KRW 2.4 billion in 2023, KRW 1.9 billion in 2024, and KRW 1.6 billion in 2025.
Both trading value and transfers to KOSDAQ are at or near record lows. This year, JINCOSTECH is the only listed company to have successfully transferred its listing from KONEX to KOSDAQ, and it is scheduled to complete the transfer on the 15th of next month. The number of companies transferring to KOSDAQ has also declined from 13 in 2021 to six in 2022, seven in 2023, four in 2024, and four in 2025. This is why KONEX, which was launched to help small and venture companies enter the capital market, is being described as a market in name only.
The easing of requirements for direct KOSDAQ listings is cited as the biggest factor behind KONEX's stagnation. As entry routes to KOSDAQ have diversified through measures such as special technology-based listings and special listings for companies that have not yet turned a profit, the need to go through KONEX has diminished, analysts say.
However, the financial authorities' recent decision to raise the bar for entering and maintaining a stock-market listing as part of efforts to improve the capital market's fundamentals could change the situation. As KOSDAQ listing requirements become more stringent, more companies may consider listing on KONEX. In fact, the "Measures to Improve the Initial Public Offering (IPO) and Delisting Systems," which center on more cautious participation by institutional investors in demand forecasts, took effect in July last year. As a result, the number of companies listed on KOSDAQ this year fell to 29. KOSDAQ listed 67 companies in each of 2024 and 2025.
KONEX, in particular, believes that allowing companies at risk of delisting from KOSDAQ to transfer their listings to KONEX could help revitalize the market. Since the 23rd, companies that fail to meet the market-capitalization requirements for KOSPI or KOSDAQ but satisfy certain conditions have been allowed to transfer their listings to KONEX. Companies facing delisting would gain a chance to make a fresh start, while KONEX could fulfill its original role as a stepping stone to the stock market.
Kim Hwan-sik, former chairman of the KONEX Association and CEO of HanJungNCS, said, "There are many companies that could recover if they were given a little more time to get back on track, even if they are facing delisting. By moving to KONEX, they can receive oversight, which would protect existing shareholders while giving the companies another opportunity." He added, "At the same time, the number of companies listed on KONEX and the market's trading value would increase, as would transfers to KOSDAQ, creating a virtuous cycle."
So far, Silla SG is the only company to have expressed an intention to transfer its listing to KONEX, and companies are taking a wait-and-see approach. Most companies reportedly want to observe how the process unfolds before deciding whether to transfer, as liquidity in the KONEX market is currently extremely limited.
A representative of the KOSDAQ Listed Companies Association said, "Because each company is in a different situation, the criteria they consider also vary. However, there is an atmosphere of weighing whether to proceed with delisting as planned or transfer the listing." The representative added, "Many companies appear to be waiting to see how the new system works before making a decision." 
[email protected] Im Sang-hyeok Reporter