Heavyweight varieties have been approved as "Class III devices", can GIANT BIOGENE (02367) see a rebound moment after its stock price was halved?

As of October 22, GIANT BIOGENE (02367) experienced a 31.65% decrease in its stock price in October this year. Taking a longer view, since reaching a phase high of 85.14 Hong Kong dollars in intraday trading on May 20 this year, GIANT BIOGENE's stock price has cumulatively dropped by 55.18%. In other words, its stock price has gone through a "halving" trend over five months, and it wasn't until October 23 that signs of a halt in the decline were observed. It was learned that on October 23, GIANT BIOGENE's restructured Type I 1 sub-type collagen freeze-dried fibers obtained approval from the NMPA, receiving a Class III medical device registration certificate. As a result of this positive news, on the morning of October 23, GIANT BIOGENE's stock price surged, reaching a high of 43.92 Hong Kong dollars within the first half-hour of trading, marking a 13.72% increase. A large bullish candle also ended GIANT BIOGENE's recent downtrend of 14 consecutive negative days. However, after the morning surge, GIANT BIOGENE's stock price did not continue to rise, showing a clear retreat, eventually closing up by 6.68%. Whether the stock price will successfully rebound after this surge and retreat has undoubtedly become the focus of investors' attention. The backdrop of the "halving" trend From an overall perspective, GIANT BIOGENE's stock price has experienced significant and dramatic fluctuations this year. Initially, from the beginning of the year until mid-May, the company benefited from strong positive performance from the previous year, leading to a strong performance in its stock price. The increase in the range period once reached 70%, and on May 20, it hit a phase high of 85.15 Hong Kong dollars, with a market value surpassing 90 billion Hong Kong dollars. During this market phase, driven by the concept of collagen reorganization in the industry and verified company performance, GIANT BIOGENE's value as an investment continued to rise. Looking at the Bollinger Bands indicator, from January to early May, for nearly two-thirds of trading time, GIANT BIOGENE's stock price closely followed the upper Bollinger Band. Analyzing market volume, on only April 17 did a large trading volume occur, with that day's volume reaching 60.53 million shares, marking the first day since the beginning of the year that GIANT BIOGENE's daily trading volume exceeded 15 million shares. For the remainder of the time, the daily average volume was below 15 million shares, highlighting a "volume-less rise". Even on April 7, when the stock price dropped by 15%, the volume was only 6.47 million shares. This trend and volume clearly show that market participants were waiting to buy, and even through small trades outside the market, they could steadily push up the stock price. However, starting from late May, the company's stock price began to sharply decline, especially after the "collagen reorganization not detected" incident, leading to several consecutive days of significant declines. For example, from May 26 to 28, the price decreased by around 10%. Subsequently, due to factors such as the underperformance of core products in "618" and the slower-than-expected approval process for the company's medical aesthetic injections, GIANT BIOGENE's stock price began to steadily decline. During this time, the change in market sentiment towards the valuation of GIANT BIOGENE can also be seen from the volume. Compared to the volume-less rise in early May, the daily average volume increased significantly afterwards. Starting from May 23, GIANT BIOGENE's daily trading volume gradually increased to over 10 million shares, reaching above 1 billion shares until June 30, with only one trading day where the volume was below 10 million shares. The decline in the stock price and active market trading reflect the ongoing disagreement among investors, but at the same time, it shows a consistent attitude among certain of the currency holders outside the market who are buying at the bottom. To boost market confidence, GIANT BIOGENE's management has been consistently increasing their holdings. It is understood that on June 9 this year, GIANT BIOGENE announced that the board received notification from the controlling shareholder, Juzi Holding, stating their plan to increase their shareholding in the company by no less than 2 billion Hong Kong dollars within three to six months from the date of the announcement. As of October 16, the company's shareholders had accumulated 3.9166 million shares, investing approximately 198 million Hong Kong dollars, completing 99.2% of the share purchase plan, and increasing their shareholding to 54.56%. In terms of market sentiment, from June 9 to October 16, on the day of the company's share increase announcement and after the first disclosure of progress in increasing holdings, GIANT BIOGENE received positive feedback from the secondary market. Especially after the first disclosure of increased holdings on June 25, the stock price rebounded significantly, with a 14.83% increase from June 26 to 30. However, subsequent increases by the company led to a diminishing marginal effect on market reaction. For instance, after the company disclosed increased holdings on the night of September 25, the next day the stock price rose by only 0.84%; after the disclosure of increased holdings on October 16, the stock price still fell by 3.40% the following day, showing a clear cooling of the market response and reflecting the need to further increase investor confidence in the company's long-term positioning. Can the approval of the significant types of products "restore market confidence"? As mentioned earlier, the incident of "collagen reorganization not detected" in May this year was the direct trigger for GIANT BIOGENE's stock price entering a downward trend. However, the main reason for the continued pressure on the company's stock price in the second half of this year may lie in other companies in the same industry receiving a strategic investment of 3.4 billion yuan to develop the collagen reorganization market. From a market perspective, Frost & Sullivan predicts that the size of the Chinese collagen reorganization market will exceed 193.7 billion yuan by 2027, with a compound annual growth rate of up to 35%, far surpassing the single-digit growth rate of traditional hyaluronic acid, becoming a hot and certain race track. By 2027, the retail market size of Chinese medical aesthetic injectables will reach 147.0 billion yuan. The market size of collagen reorganization medical aesthetic injectables will reach 14.3 billion yuan, accounting for 9.8% of the retail market size of medical aesthetic injectables and 85.5% of the retail market size of collagen reorganization medical aesthetic injectables. After the wave of events in May, the criticality of technological barriers was further emphasized. According to the "Collagen III Triple Helix Collagen White Paper" jointly released by Sullivan and Hengy Medical Bio, collagen plays a key biological role due to its unique triple helix structure. This structure consists of three collagen molecular chains precisely wound in a right-handed helix manner, forming a configuration similar to a high-strength biological spring, providing high-strength mechanical support, efficient biological activity transfer, and long-lasting metabolic stability, which is crucial for collagen to have anti-aging and repair effects on the skin. JINBO currently holds the only license in China for class III recombinant collagen type III injectables, and is the only enterprise globally to decipher the structure of human type III collagen 164.88 triple helix and achieve mass production, leading the technical path by 3-5 years among peers. This has become the core support for capital premiums. Although there is still a certain gap in the technical path between recombinant Type I 1 sub-type collagen and the currently popular "recombinant Type III triple helix collagen" in the market, its approval is nevertheless very important for GIANT BIOGENE. From this, the company can build a complete product matrix from "cosmetics registration" to "medical device registration" and then to "Class III medical devices". Coupled with the Wuxi Online Offline Communication Information Technology Co., Ltd.'s scaled sales network formed by GIANT BIOGENE, high-performance prospects in the later period can still be expected.