Nikola Drops 19%, 'Seohak Ants' Lose 34 Billion Won in One Day

[Asia Economy Reporter Minji Lee] The stock price of American hydrogen fuel cell vehicle company Nikola plummeted following the resignation of its founder, causing domestic investors who invested in Nikola stocks to incur losses amounting to hundreds of billions of Korean won in just one day.

According to the Korea Securities Depository's securities portal SaveRO on the 22nd, the scale of Nikola stock holdings by domestic investors was estimated at $150.66 million (approximately 175.3 billion KRW) as of the 21st.

On the 21st (local time), Nikola's stock price on the Nasdaq market plunged by 19.33%, resulting in an estimated decrease of about 33.9 billion KRW in the value of Nikola stocks held by domestic investors in just one day.

Since Nikola was listed on Nasdaq in early June, domestic investors have net purchased approximately $208.31 million worth of Nikola stocks, as the company was spotlighted as the "second Tesla." After listing, Nikola's stock price soared to around $79 in early June but later faced bubble and fraud controversies, closing at $27.58 on the 21st, about one-third of its peak price. The total losses incurred by investors so far are estimated to exceed the one-day loss of 33.9 billion KRW.

The plunge in Nikola's stock price was triggered by the resignation of Nikola's Trevor Milton from the position of chairman of the board on the 20th (local time). Milton's resignation followed a report released on the 10th by short-selling firm Hindenburg Research, which labeled Nikola as a fraudulent company. The market has already expressed concerns that Nikola could cause distrust in the hydrogen vehicle industry.

Due to Nikola's plunge, related stocks in the domestic stock market have also been affected. Hanwha Solutions, which invested $100 million in 2018 and holds a 6.13% stake in Nikola through its affiliates, saw its stock price plunge 7.40% in the domestic market as of the previous day, while Hanwha also fell by about 2%.