Kumyang (001570.KS), a company that rode the secondary battery boom to rapid growth, now faces delisting after external auditors refused to issue an opinion on its financial statements for the second consecutive year, effectively undermining the basis for maintaining its stock exchange listing.
According to the Financial Supervisory Service's (FSS) electronic disclosure system on Sunday, Kumyang received an audit opinion refusal on its 2025 audit report, following the same result for 2024. The Korea Exchange (KRX) has determined this constitutes grounds for delisting and initiated the relevant procedures.
The exchange has given Kumyang until June 13 to file an objection. If an appeal is submitted, the exchange plans to merge it with the previous 2024 audit opinion refusal case and deliberate on the delisting decision. However, analysts say overturning the outcome will be difficult given the consecutive refusals.
The external auditor raised questions about the company's ability to continue as a going concern. Kumyang recorded operating losses in the 40 billion won range and net losses in the 50 billion won range for 2025. Current liabilities exceeded current assets by more than 600 billion won, indicating severe short-term solvency problems. The auditor determined that such a financial structure "raises significant doubt about the company's ability to continue as a going concern" and refused to issue an opinion.
A liquidity crisis is also materializing. Kumyang recently entered forced auction proceedings for its secondary battery factory site in Gijang-gun, Busan, due to unpaid construction costs. The company also faces a lawsuit from Busan Bank seeking repayment of approximately 130 billion won in loans. The cash crunch is simultaneously shaking both its production base and financial credibility.
The final delisting decision rests with the exchange's review, but the prevailing analysis is that prospects for a reversal remain limited without improvements in the company's financial structure and a restoration of trust.