From a beloved penmaker to a well-known seafood brand, individual investors have rushed to buy shares of struggling companies facing possible delisting. Their buying spree has sent stock prices sharply higher as they try to save familiar brands from disappearing from the market.
But the buying spree has also raised a broader question: Is it an act of loyalty to iconic South Korean companies or simply shareholders trying to avoid losses? Experts say it may be a mix of both, exposing an unintended effect of the Korea Exchange's tougher delisting rules.
"Many investors are likely buying shares not only to support the company but also to protect their own investment from losses," said Lee Jeong-hwan, a professor of economics and finance at Hanyang University.
The clearest example was Hansung Enterprise, a seafood processor best known for Crabme, one of South Korea's best-selling crab-flavored seafood products. Its shares surged 100 percent last week, making it the top-performing stock in the market.
The stock climbed from 4,635 won to 8,460 won in just about a week, hitting the daily 30 percent price limit in two consecutive sessions on Thursday and Friday. The rally showed little sign of slowing on Monday. As of 2:40 p.m., shares were up 26.83 percent at 10,730 won after earlier touching the daily limit of 10,990 won.
Hansung had been struggling with rising raw-material costs and weakening profitability, leaving the company at risk of delisting after its market capitalization slipped to 28.7 billion won, below the Korea Exchange's new requirement.
The turnaround began not with an earnings surprise or a restructuring announcement, but with posts on online investor forums. Users shared stories about the company's long-running charitable activities, including hosting annual concerts for Korean War veterans for roughly 25 years, prompting some retail investors to buy its shares to support a company they believed deserved another chance.
A similar story unfolded at Monami, one of the country's best-known stationery brands, whose inexpensive ballpoint pens have been a fixture in classrooms, offices and homes for decades.
The stock climbed 62 percent during the week, rising from 1,318 won on July 6 to 2,145 won after nearly hitting the daily trading limit on two consecutive sessions. The rally extended into Monday, with the shares up another 17.02 percent at 2,510 won as of 2:41 p.m., after touching an intraday high of 2,780 won, just below the daily price limit of 2,785 won.
The rally also lifted its market capitalization from 24.9 billion won to 40.5 billion won, helping the company avoid the immediate risk of delisting.
For many investors, it was about preserving a familiar brand. "I hardly ever go to stationery stores anymore, but I still bought a Monami three-color pen online not long ago," said Lee K.M., a South Korean IT professional in his 30s who studied in the U.S.
"It's cheap, writes well and is one of those reliable Korean products that has always been around. I even carried Monami pens with me when I lived in the U.S."
His sentiment appeared to resonate with many retail investors, several of whom described Monami as one of those familiar brands that had quietly endured for decades.
Song Jae-hwa, the CEO of Monami, also posted a handwritten message on the company's official Instagram account on July 10. "Your trust and support have given us tremendous strength during a time when Monami faced the possibility of delisting."
The rallies quickly evolved into a broader debate across online investing communities over whether investors were preserving Korean brands or simply fueling another speculative trade.
On Naver's stock message board, one investor wrote, "Monami is a patriotic company. Let's send it to 10,000 won by Liberation Day," while another described it as "a good company that even pays dividends."
Others were far more skeptical. "There are limits to using patriotism to manipulate a stock," one investor wrote.
Another investor wrote: "Delisting doesn't mean the company disappears — just buy its products instead," arguing that consumers should support the companies through purchases rather than by driving up their share prices.
One investor summed up the debate: "Patriotism or not, I have to survive first."
The episode revived memories of South Korea's 2019 boycott of Japanese products, when patriotic consumption spilled into the stock market. On July 4, 2019, Monami's shares surged 29.88 percent to close at 3,325 won, hitting the daily trading limit as investors bet consumers would shift away from Japanese stationery brands.
The following day, Shinsung Tongsang, operator of homegrown casualwear brand Topten, jumped as much as 26.6 percent intraday on expectations that the boycott would also benefit domestic apparel makers at the expense of Japanese rivals such as Uniqlo.
Unlike those gains, however, the latest rallies have been driven not by expectations of stronger sales but by investors' attempts to keep companies above the Korea Exchange's minimum market-capitalization requirement.
Lee of Hanyang University, said the buying was a predictable response from shareholders facing potential losses, but he said the episode also raised questions about the exchange's new delisting rules.
"If a brief rise in the share price is enough to lift a company back above the 30 billion won threshold, similar episodes could continue," he said. "That suggests the listing standards need to be refined."
Yang Jun-sok, a professor of economics at the Catholic University of Korea, offered a more market-driven explanation. He said distressed companies often attract speculative buying from investors hoping for a last-minute rescue through an acquisition, government support or another turnaround.
"In many cases, investors buy because they believe someone else will eventually rescue the company through an acquisition or financial support," Yang said. "Even if that doesn't happen, they may think the shares have already fallen so much that the downside is limited."
He compared the episode to the 2021 GameStop frenzy in the U.S., when retail investors on Reddit's WallStreetBets forum piled into shares of the struggling video-game retailer. The buying was driven less by confidence in the company's business than by a desire to inflict losses on hedge funds that had heavily shorted the stock.
The stock soared from $17.25 at the start of January to as high as $483 on Jan. 28, forcing many short sellers to buy back shares to limit their losses and driving prices even higher.
"That wasn't a normal investment either," Yang said. "Many participants were motivated to punish short sellers for betting against the company."
Whether the recent rallies reflect genuine support for familiar Korean brands or simply another speculative trade remains open to debate.
One widely shared online post captured that skepticism with a sarcastic remark: "This is what the Korean stock market has come to — we're talking about pen stocks and imitation-crab-stick stocks while the rest of the world is talking about artificial intelligence."
Regardless of investors' motives, however, the episode has already exposed an unexpected consequence of the country's tougher delisting regime. Rules intended to weed out weak companies instead encouraged some shareholders to rally around them.
For now, the buying spree has bought both companies more time. Whether it represents a new form of patriotic investing or simply shareholders trying to protect themselves from losses remains open to debate. The bigger question is whether the momentum can continue once the initial excitement fades.
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