The special listing system, which provides an opportunity for companies with excellent technical skills and potential growth to enter the KOSDAQ market early, will be introduced for the first time in 2005. The special listing system have been changed ...
The special listing system, which provides an opportunity for companies with excellent technical skills and potential growth to enter the KOSDAQ market early, will be introduced for the first time in 2005. The special listing system have been changed and applied to the current system of listing for technology growth companies. While the positive effect of providing funding opportunities through early entry into the KOSDAQ market for firms with excellent potential is very clear, individual investors who have difficulty accessing firm information also concerned by the listing of unstable and uncertain them. This study compares companies that were specially listed on the KOSDAQ market with those that were listed on the regular IPOs and finds that the smaller the size of the company and the inferior in debt ratio, profitability, asset utilization and growth, the more they choose to be listed on the special listing rather than on the regular listing. The results reflect the special listing characteristics of allowing companies with poor business conditions to enter the stock market, although their future potential is highly evaluated. Since early entry of companies with high uncertainty in the early stages of growth is likely to hurt individual investors with low information ability, regulations are needed to prevent them.