KOSDAQ-listed Joah Pharmaceutical hit its lowest price in 20 years. The company appears to have been affected by the shutdown of its key production facility, the Gyeongnam Ham-an factory, which was found to be operating an unauthorized wastewater discharge facility. It has been reported that prior to this information being announced, foreign investors sold their shares, which were then purchased by individual investors.
Joah Pharmaceutical shares traded at 836 won on the KOSDAQ market at 2:05 p.m. on the 11th. The stock price fell 0.48% (4 won) from the previous day. The stock price of Joah Pharmaceutical had dropped to 797 won during the previous day's trading session, marking a new low since August 2004.
Adverse factors related to production disruptions have emerged. Joah Pharmaceutical announced on the 10th that its Ham-an factory is scheduled to halt production starting next month on the 24th. The Nakdong River Basin Environmental Office of the Ministry of Environment found in its inspection in October that the Ham-an factory was found to be operating an unauthorized wastewater discharge facility that exceeded the standards for specific harmful substances in wastewater discharges in restricted areas. The Ham-an County Office issued an administrative order to Joah Pharmaceutical to close the wastewater treatment facility on the 9th.
In the month leading up to the administrative order, foreign investors sold off Joah Pharmaceutical shares. From the 1st of last month to the 9th of this month, foreign investors net sold 102,124 shares of Joah Pharmaceutical, worth approximately 116 million won. Since Joah Pharmaceutical's market capitalization was only about 30 billion won, the foreign sell-off trend also affected the stock price.
The Market Surveillance Committee of the Korea Exchange designated Joah Pharmaceutical as an investment caution item, noting that trading in its shares was concentrated among a small number of accounts. During the three trading days from the 12th to the 14th of last month, one specific foreign account accounted for 9.45% of the trading activity in Joah Pharmaceutical shares. The top 10 accounts accounted for 40.66%.
Most of the shares sold by foreign investors were acquired by individuals. From the 1st to the 9th of last month, individuals net bought 96,210 shares of Joah Pharmaceutical, worth approximately 110 million won. According to the average buying price of 4018 won for 759 Joah Pharmaceutical investors linked to the Naver Pay 'My Assets Service' and account information, the loss rate is nearing 80%.
Joah Pharmaceutical stated that it could distribute and sell products manufactured before the production halt. However, since the sales of products produced at the Ham-an factory account for 74.7% of Joah Pharmaceutical's total sales, a significant impact on management is unavoidable. Joah Pharmaceutical noted that it plans to promptly complete necessary improvement work in cooperation with local governments while complying with relevant regulations and administrative procedures.