Libang Medicine-B (9637.HK) In-depth Analysis of Market Fluctuations on July 2nd

$ALEBUND-B(09637.HK)

I. First, the facts: Despite a large drop, the 'dumping' was very unusual

On July 2nd, the company's stock closed at HKD 25.50, a single-day drop of 34.7%. The number is indeed scary, but if we break down the trades one by one, the structure of this decline is very abnormal—it was not a sustained sell-off triggered by fundamental negative news, but a typical 'thin order book instant breakdown'.

The key evidence lies in the first four minutes after the market opened:

*Includes 95,800 shares from the 9:20 opening auction (traded at the previous close of 39.04).

In other words, excluding the opening auction, the continuous auction sell orders that actually drove the price down from 37.44 to below 26 amounted to less than 240,000 shares in total, about HKD 7 million—less than 3% of the day's total volume of 8.27 million shares. Using less than HKD 10 million in chips to knock down the price by over 30% in four minutes can only be explained by: the seller completely disregarded cost, using market orders to sweep down through the buy order queue. Normal stop-loss orders would be limit orders, placed in batches; this 'price doesn't matter, only speed' approach has the clear characteristic of a cost-blind liquidation, with rumors suggesting it was passive selling triggered by large mutual fund redemptions.

II. More important evidence: What happened after the dump

If the market truly agreed with a 22 yuan valuation, the stock price should have stayed low. But the actual trend was the opposite:

• After hitting the day's low of 22.70 at 9:48, buy orders immediately entered the market—a single 30,000-share active buy order appeared at 9:53, with active buying accounting for 83% of that minute's volume;• The price then recovered all the way, rebounding to a high of 31.98 in the afternoon at 13:39, a 41% increase from the low;• The day's active selling and active buying were almost evenly matched (internal market 51.6% vs external market 48.4%), compared to the one-sided 66% active selling on June 30th, selling pressure has clearly weakened;• In the last 30 minutes before the close, the proportion of active buying actually rose to 61%, indicating funds were absorbing at low levels, not panic selling;• The closing auction only saw 138,000 shares traded, matched at the average price, and did not depress the closing price—the massive 459,000-share dumping at the end of June 30th was not repeated today.

In a word: The most intense phase of panic was already released during the morning session on July 2nd. 22.70 is a bottom verified with real money that day—every share sold at that price was bought with real money.

III. A few conclusions

1. The company's fundamentals did not change overnight. This round of decline was driven by trading behavior; the 41% intraday V-shaped rebound itself shows the market does not agree with the ultra-low price level. 2. Don't make decisions when emotions are worst. The four-minute waterfall decline in the morning session precisely shows: using market orders to escape during times of thin liquidity results in execution prices far worse than expected—panic itself is the biggest cost for retail investors. 3. Watch for two signals going forward: First, whether the stock price can stabilize in the 25.5–26 yuan closing support zone; second, whether the previously anonymous seller in the CCASS (Central Clearing and Settlement System) position changes has finished selling. These two signals are more reliable than any rumor.

(This article is based on Wind tick-by-tick data and is solely for market information analysis, not constituting any investment advice.)