The Korea Herald reported Friday, citing financial-industry sources, that South Korea’s Korea Exchange (KRX) is weighing three categories for Kosdaq issuers, a proposal that could influence where investors direct attention and funding.
KRX is considering a top category for larger, mature businesses, tentatively named the Select Segment. The Korea Herald reported that market capitalization, revenue, earnings and corporate governance could factor into eligibility. A KRX official told the Herald the exchange does not intend to set a fixed cap on the number of qualifying companies.
That official said the upper group could account for 10% of Kosdaq listings at first, with KRX aiming for a 30% share as companies grow. Businesses in a growth phase would fit a middle category. Firms with trading problems or possible delisting would be flagged separately on a watchlist. For the middle category, KRX is weighing extra disclosures covering company plans, earnings expectations and preliminary results, the report said.
A KRX official told The Korea Herald that Kosdaq carries more risk than Kospi and needs to offer returns that justify it. The official identified leading biotechnology and artificial intelligence companies as potential examples for the upper group. The report linked the proposal to Nasdaq’s three listing markets, introduced in 2006, and recounted an earlier shift of companies from Nasdaq to the New York Stock Exchange before some later moved in the opposite direction.
A KRX official expressed concern that capital might gather in the top category, leaving companies in lower groups struggling to obtain funding, according to the Herald. KRX is weighing public funding and investor incentives to support those firms; tax benefits have not been settled, the report said. The exchange also plans to seek industry input on its criteria and support measures, according to The Korea Herald.
The KRX expects to set detailed eligibility rules after companies report annual results in April 2027, the official told the newspaper. A launch in the second half of 2027 is the earliest possibility, the official said.
