[Edaily Reporter Kim Hyung-il ] SK hynix(000660), which was once a “penny stock” trading for less than 1,000 won back in the days of INICS Corporation, has since grown into one of Korea’s leading semiconductor companies. This has sparked a growing debate over the recently tightened delisting criteria for the KOSDAQ market. While mechanisms to weed out underperforming companies are necessary, critics point out that relying solely on quantitative criteria—such as stock price and market capitalization—to remove even companies with growth potential from the market could prevent the emergence of a “second SK Hynix.”

According to the Korea Exchange and other sources on the 31st, the requirements for maintaining a KOSDAQ listing were tightened starting last July. The market capitalization threshold was raised to 20 billion won, and penny stocks—those trading below 1,000 won—were also included in the new delisting criteria. If a company fails to meet the criteria for 30 consecutive trading days, it is designated as a “monitored stock”; if it fails to regain compliance for at least 45 consecutive trading days out of the subsequent 90 trading days, it is delisted. As of the 12th, 21 KOSDAQ stocks had been designated as monitored stocks due to share prices below 1,000 won, and four others fell short of the market capitalization requirement.

However, some observers point out that even SK hynix—currently the second-largest company by market capitalization in Korea and expected to post an operating profit of 260 trillion won this year—was once a “penny stock.” Based on stock prices at the time—which did not reflect adjusted prices—SK hynix’s predecessor, Hyundai Electronics, remained below 1,000 won on a closing price basis from April 29, 2002, to April 11, 2003. In effect, it remained a penny stock for nearly a year. If the recently tightened KOSDAQ delisting criteria had been applied to Hyundai Electronics at that time, it would have been difficult for the company to avoid delisting proceedings. On March 26, 2003, Hyundai Electronics even closed at 135 won. At the time, the company was facing severe financial difficulties, including operating losses due to a slump in the semiconductor market and heavy financial burdens.

Hyundai Electronics’ crisis went beyond a simple stock price decline; it was a period when the very survival of the company was at stake. After Hyundai Electronics came under joint management by the Credit Institutions Council, it carried out a 21-to-1 stock split, causing its stock price to plummet; the restructuring process involved repeated capital increases and stock splits. The market even began to speculate about the possibility of delisting. However, Hyundai Electronics continued to invest in semiconductors. Starting in the third quarter of 2003, the company returned to operating profitability, laying the groundwork for a turnaround in its performance. After emerging from joint management by the creditor consortium in July 2005, its stock price recovered to 40,100 won by September 2006. Even afterward, the company continued to experience ups and downs, including a return to losses and a decline in its stock price as it navigated semiconductor market cycles and the global financial crisis.

Since then, SK hynix has survived by maintaining its semiconductor business and building competitiveness rather than shutting down operations during crises. Its performance improved after emerging from creditor-led receivership, and it maintained its competitiveness by continuing to invest even when the semiconductor market deteriorated again. Its integration into the SK Group in 2012 marked another turning point. Leveraging SK Group’s investment base, the company strengthened its memory semiconductor business and subsequently secured a new growth engine as the high-bandwidth memory (HBM) market expanded alongside the growth of the AI industry. This is why analysts point out that the journey of a company—which once fell to 135 won—to become today’s SK hynix was not merely a stock price rebound, but a process of weathering crises to build business competitiveness and seizing new growth opportunities.

Lee Jin-woo, Head of the Research Center at Meritz Securities, stated, “Although there were financial vulnerabilities at the time, the company’s ability to weather multiple semiconductor market downturns ultimately led to its current competitiveness,” adding, “Since the semiconductor industry requires constant investment to survive, the company’s efforts to increase its competitiveness and market share have been crucial.”

Some analysts point out that while stock prices and market capitalization are indicators of a company’s current situation, they are difficult to use as criteria for judging future growth potential. In particular, it is difficult to assess growth potential based solely on stock prices or market capitalization at a specific point in time—not only in industries like semiconductors, which experience significant cyclical fluctuations and shifts in market leadership due to technological changes, but also in sectors such as biotechnology, robotics, and materials and components, where corporate value can vary greatly depending on technological development and market expansion. It has been pointed out that if a company—which has secured technological capabilities and increased actual sales but remains at a low stock price due to a lack of market interest—is delisted based on quantitative criteria, its future growth opportunities themselves could vanish.

Consequently, there are calls to refine and flexibly adjust the strengthened KOSDAQ delisting criteria. Lee Jun-seo, a professor in the Department of Business Administration at Dongguk University, stated “While the goal of weeding out underperforming companies to ensure the soundness of the KOSDAQ market is correct in principle, rather than delisting companies simply because they mechanically meet quantitative criteria such as market capitalization or stock price, a procedure is needed to comprehensively review growth potential and profitability at the final stage,” he said. “There is a need to establish more refined criteria to prevent companies that consistently generate profits or maintain growth potential from being expelled from the market all at once.”