On August 18, Hong Kong's biotech sector witnessed a "secondary market" phenomenon as JIUYUAN GENE (02566) touched an intraday high of HK$16.29, representing a surge of over 218% from its low of HK$5.119, pushing its market capitalization beyond HK$30 billion. This epic rally that began in early June has propelled this GLP-1 drug-focused biotech company into the capital market spotlight.
Behind the frenzied capital influx lies the weight-loss indication for semaglutide biosimilar (JY29-2), scheduled for New Drug Application submission in the first half of 2026. Regarding market positioning and channel planning for semaglutide, the company stated it will strengthen its first-mover advantage in the hospital market, expand accessibility through pharmacy networks, collaborate strategically with e-commerce platforms, and accelerate brand building and user outreach.
Notably, beneath the feast lies underlying currents. From November 2024 to August 2025, JIUYUAN GENE completed a classic "accumulation-washout-rally-distribution-second rally" capital game. This capital carnival ignited by innovative drug expectations raises the question: is it value discovery or capital manipulation?
**Accumulation Phase: High Volatility Restructures Chip Distribution**
According to analysis, JIUYUAN GENE's accumulation phase occurred from November 28, 2024, to January 17, 2025, during which capital restructured chips through significant volatility.
The company's IPO garnered substantial interest. Public data shows the global offering of 45.3988 million shares, with public offering (after reallocation) accounting for 50% and international offering (after reallocation) for 50%. The public offering was oversubscribed 675.83 times, while the international offering was oversubscribed 1.18 times. The global offering raised approximately HK$485 million net.
Due to the public offering's oversubscription exceeding 100 times, the clawback mechanism was triggered, reallocating 18.1594 million shares from international to public offering, leading to increased retail shareholding and lack of institutional anchor investors.
First-day trading showed JIUYUAN GENE opened significantly lower, forcing large-scale stop-loss selling, closing down 38.41%.
During the accumulation and washout phase, capital absorbed shares through high-volatility oscillations. First, by creating a 26.62% decline combined with 52.7% high volatility, presenting a "violent fluctuation + gradual decline" pattern that forced retail investors to exit. Positive volume of 38.839 million appeared at low levels, while negative volume of 12.308 million occurred at highs, forming a "high-volume accumulation at lows + low-volume at highs" pattern.
The turnover rate reached 46.885%, indicating full chip exchange and low-cost accumulation by main players. With an average price of HK$8.062, the main force's accumulation cost was approximately HK$7.5-8.5, reserving over 50% upside potential.
The main buying seats during accumulation were HSBC Hong Kong, CITIC Securities Brokerage Hong Kong, Bank of China (Hong Kong), and Citibank, with shareholding increases of 1.78%, 1.56%, 1.44%, and 1.25% respectively.
**Washout Phase: Chip Rebalancing**
The chip rebalancing during reconstruction can be divided into two stages: the first rally (January 20 to February 21), breaking away from the cost zone to test market support; and the consolidation washout period (February 24 to April 11), building momentum for the second rally.
During the first rally, the market showed moderate volume breakout. The period gained 30.04% with only 5.646% turnover, indicating tight capital control. Positive volume comprised 64.5%, showing clear capital intervention during rises. The stock repeatedly tested the HK$7.0 level, quickly rising to HK$7.189 after breakthrough, escaping the cost zone.
During the consolidation period, the market showed volume contraction and alternating positive-negative patterns. Over 34 trading days, the decline was only 17.89% with 30.115% volatility, as capital traded time for space. There were 18 positive days versus 16 negative days in a tug-of-war between bulls and bears.
The 7.034% turnover increased from the previous stage, indicating some capital position changes. Volume-price divergence occurred with peak volume of 1.2336 million versus trough volume of 48,400, as capital engaged in "high selling, low buying," creating "high-point volume inducement + low-point volume washout."
**Main Rally and High-Level Distribution: Locked-Share Rally Attracts Capital, High-Level Distribution**
After building momentum, JIUYUAN GENE entered its main rally and distribution phase, divided into: locked-share preparation (April 14 to June 5), main rally (June 5 to June 12), and distribution period (June 13 to June 30).
In the first stage, the locked-share preparation period saw turnover plummet to 2.7%, with daily average volume of only 83,300 (compared to previous 225,800), showing clear locked-share signs.
The violent main rally followed, displaying extreme short-squeeze momentum. Specifically, six days of explosive 72.08% gains, with 98.85% positive volume ratio and no negative line pullbacks, showing perfect volume-price coordination.
The 10.89% turnover indicated short-term chip loosening without large-scale distribution. The average price of HK$8.733 had doubled from the cost zone, providing substantial floating profits.
The third stage was the high-level distribution period, with prices ranging from a high of HK$11.84 to a low of HK$7.76, declining 26.7% with 38.06% volatility in a cliff-like drop. Nine negative days versus three positive days showed bears controlling the situation as capital entered chip distribution phase.
**Oversold Rebound and Second Main Rally: Technical Rebound Followed by Chip Redistribution**
After the acceleration period, JIUYUAN GENE experienced technical oversold rebound (July 2-10), followed by high-level chip redistribution (July 11 to August 8), preparing for the main rally accelerator (August 11-18).
During the oversold rebound, prices rose from HK$7.85 to HK$10.58, gaining 28.66% and quickly recovering partial losses. Positive volume of 4.0162 million (90.7%) versus negative volume of 410,400 (9.3%), with volume expansion during rises (peak 2.604 million) and extreme contraction during falls (trough 77,400), indicated main force repurchasing.
After the oversold rebound, capital restructured floating chips through consolidation, preparing for subsequent directional moves. Prices operated in a range from high of HK$10.960 to low of HK$9.450 (14.95% volatility), showing high-level box consolidation with only 1.98% net change.
Following consolidation, the second main rally began. Six consecutive positive lines gained 53.88%, with prices rising from HK$10.29 to HK$16.29 in extreme short-squeeze action dominated entirely by bulls.
**Multi-Factor Resonance Creates "Turnaround" Path**
This JIUYUAN GENE rally appears to be not merely capital speculation, but the result of fundamental breakthroughs, pharmaceutical sector rotation, and value re-evaluation after prolonged market underestimation.
First, the company's semaglutide biosimilar (JY29-2) opens up a multi-billion market space. Previously, at the March 27 earnings call, company representatives mentioned the weight-loss indication would submit for New Drug Application in the first half of 2026.
Additionally, JIUYUAN GENE has licensed overseas rights for semaglutide to other domestic pharmaceutical companies: signing exclusive licensing cooperation agreements with Sinovac Biotech for semaglutide in major Latin American countries; and signing product licensing agreement key terms with Fosun Pharma, granting exclusive clinical development, registration, and commercialization rights for semaglutide and other products in Middle East, North Africa, sub-Saharan Africa, and certain ASEAN countries. New drug applications for semaglutide are expected to be submitted to Brazil and Saudi Arabia within 2025.
Recently, multiple brokerages have published positive reports on weight-loss concept stocks, with the GLP-1 track potentially becoming capital's new favorite. Some analysts believe that with a 20% compound growth rate, the GLP-1 drug market could exceed $150 billion by 2030, viewing domestic oral weight-loss drug opportunities favorably and considering the innovative drug GLP-1 track significantly undervalued.
Other analysts believe that as domestic weight-loss drugs approach commercialization, sales capabilities will become a major factor in assessing companies' future competitive advantages. Companies with both leading R&D progress and strong sales execution will occupy advantageous positions in commercialization competition.
In conclusion, JIUYUAN GENE's surge cannot be separated from the resonance effect of "product growth potential + sector momentum + valuation repair."
Therefore, JIUYUAN GENE's capital feast represents both a victory of "value re-evaluation" and an extreme demonstration of "market sentiment and capital gaming." Behind the 218% surge from HK$5.119 to HK$16.290 lies the perfect resonance of fundamental breakthroughs, sector rotation, and main force operations.
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