[Asia Economy Reporter Hwang Yoon-joo] Engchem Life Sciences recorded a limit-up due to the ex-rights effect of a bonus issue.
As of 9:46 a.m. on the 17th, Engchem Life Sciences is trading at 4,400 KRW, up 29.99% compared to the previous day.
The limit-up is due to the illusion effect caused by the ex-rights of the bonus issue. On this day, Engchem Life Sciences implemented an ex-rights for a 500% bonus issue.
Ex-rights refers to the expiration of the right to receive new shares granted by the bonus issue. When ex-rights occur, trading begins at an artificially adjusted reference price corresponding to the newly issued shares.
This creates an illusion effect where the stock price appears relatively cheap. Thanks to the low-price buying sentiment, the stock price surges.
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