YG Stock Shares Plummet As They Face Massive Shorting Since The Seungri Scandal
YG Entertainment is facing troubles in their finances as their investors are short-selling their shares and its price plummets in a steep decline.
YG saw its highest size on shorting for its shares during this quarter as Seungri’s Scandal caused a highly detrimental effect on the agency’s earnings.
YG Entertainment is currently being investigated for tax evasion, while its brand image continues to decline ever since Seungri was caught up in investigations for prostitution, illegal drug use, embezzlement, distribution of illegal sex cams, and more.
As the controversial issues pile up, its artists are facing boycotts from various universities and the public associate them to the agency’s currently bad image.
YG Entertainment’s share price closed at 33,750 won (~$28 USD) on Thursday, which is 35% lower than its peak back in January. Near the end of 2018, market analytics were optimistic about YG’s increase in profit for this year. The complete opposite is currently happening as YG struggles to fight back against the Seungri Scandal effect.
Market analysts claim YG will unlikely recover its share price anytime soon.
There’s no momentum to lead share prices of YG Entertainment for a while.
Investors should take a cautious approach. Separate from the Seungri scandal, there is also an ongoing tax audit on YG Entertainment.
—Nam Hyo Ji, KTB Securities Researcher
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