In 2024, 35.6 percent of companies by market capitalization made valuation disclosures.
On Jan. 9, the Korea Exchange announced the progress of the corporate valuation program in 2024, the status of valuation disclosures and market trends.
Since the program was launched in late May of 2024, 102 companies have made valuation disclosures - 85 on the KOSPI market and 17 on the KOSDAQ market.
By type of disclosure, 94 companies made main disclosures and eight made preliminary ones.
KOSPI-listed companies’ participation in valuation disclosures was particularly high.
Valuation disclosures were made by 41.5 percent of companies by market capitalization on the KOSPI market.
In addition, since the implementation of value-up disclosures, the number of companies disclosing value-up disclosures has been on the rise, with two companies in May, one in June, three each in July and August, five in September, 18 in October, 28 in November and 34 in December.
Companies with a market capitalization of 1 trillion won or more accounted for 63 percent (64 companies) of the total.
By industry, the capital goods industry had the lion’s share (22 percent) of the total, followed by banking and financial services (19 percent), and consumer goods distribution and retail (8 percent).
On average, the stock prices of disclosed companies ascended by 3.2 percent since the beginning of 2024.
In particular, the stock prices of KOSPI-listed companies among them climbed by 4.9 percent since the beginning of the year, outperforming the KOSPI index return (-9.6 percent) by about 15 percentage points.
In the meantime, the Korean stock market rallied in the first half of last year on expectations of the value-up program, but closed lower in the second half of the year due to growing internal and external uncertainties as of 15:30 on Dec. 30, 2024, the last day of the stock market.
According to the Korea Exchange, the KOSPI closed at 2,399p, down 9.6 percent compared to August 2024, as volatility rose due to concerns over an economic recession, trade policies by Donald Trump and political uncertainty in Korea.
Earlier, the KOSPI had reached a record high of 2,891 points on expectations of a value-up program in the first half of the year and an influx of foreign buying on July 11.
Clarification of Regulatory System
The Financial Supervisory Service (FSS) and the Korea Exchange clarified their regulatory system to establish a fair and transparent short selling order, and prepared the final draft of unified short selling guidelines.
Specifically, internal control standards for each entity will be differentiated in proportion to the likelihood of borrowing-free short selling.
The obligation of custodial securities firms to check measures to prevent borrowing-free short selling will be strengthened.
They will prepare relevant administrative procedures for verifying the identity of a short selling entity, and lay the groundwork for detecting naked short selling by linking information between balance management systems of short selling entities and the Naked Short-Selling Detecting System (NSDS) of the stock exchange.
Regarding the expected effects, the FSS said that the amendment to the Enforcement Rules will complete system framework for computerization of short selling which is being introduced to prevent naked short selling.
It emphasized that the computerization will be completed in line with the system by the end of March 2025.
The FSS and the Korea Exchange expect that the self-prevention function and naked short selling detection function of the balance management systems will be strengthened through the clarification of regulations and the enhancement of practical applicability and the establishment of detailed standards for NSDS operation will boost the effectiveness of system operation to detect illegal short selling.
Meanwhile, the Korea Exchange announced on Jan. 17 that it will list five exchange-traded funds (ETFs) issued by Mirae Asset, Shinhan, Hana, IBK Asset Management, and Korea Investment Trust Management on Jan. 21.
