[Kim Saemi, Edaily Reporter] South Korean biotech and healthcare stocks mostly fell on November 6 amid an AI-driven market sell-off. Aribio Lab, formerly Cha Vaccine Institute, bucked the trend, gaining more than 11% on speculation about a potential merger with its unlisted affiliate Aribio. Seers hit the daily lower price limit following disappointing third-quarter earnings, while InBody plunged nearly 27% despite a sharp rise in operating profit.

Aribio Lab Jumps 11.7% on Merger Speculation After $7 Million Bond Purchase

Aribio Lab rose 11.69% to 4,300 won ($3.10), with trading volume more than doubling from November 4 to 3.2 million shares.

The rally followed the company’s decision to acquire 5 billion won in face value of Aribio convertible bonds for 10 billion won, equivalent to 84.32% of Aribio Lab’s equity. The bonds carry a conversion price of 10,000 won per share, potentially giving Aribio Lab 500,000 shares in its unlisted affiliate.

The transaction is part of a broader ownership restructuring. Aribio Lab previously announced an 18 billion won private placement, with Aribio contributing 15 billion won and Aribio Holdings 3 billion won. If completed on November 30, Aribio will become Aribio Lab’s largest shareholder.

A local media report suggested the restructuring could pave the way for a merger or a backdoor listing. An Aribio official confirmed the bond acquisition but dismissed the merger scenario as media speculation, adding that the company had no information regarding such plans.

Investors are also awaiting topline results from Aribio’s global Phase 3 trial of the Alzheimer’s drug candidate AR1001, scheduled for presentation at the Clinical Trials on Alzheimer’s Disease (CTAD) conference in Boston on November 16. The company stated that it remains focused on the upcoming announcement.

Seers Hits Lower Limit as Server Shortages Trigger Quarterly Loss

Seers plunged 29.95% to 14,500 won, hitting the daily lower price limit after reporting a third-quarter operating loss of 1.9 billion won, compared with a 6.7 billion won profit a year earlier.

Revenue fell 38% to 9.8 billion won, while the company posted a net loss of 1.9 billion won, reversing a 6.7 billion won profit.

Seers attributed the setback to server supply disruptions that delayed installations and revenue recognition for thynC, its AI-powered hospital patient-monitoring platform.

Despite the weak quarter, revenue for the first nine months rose 155% to 70.7 billion won, with operating profit reaching 24.9 billion won. The company said server deliveries resumed in late October and hospital installations are underway. It is also diversifying its suppliers, including Dell, HP, and Lenovo.

CEO Lee Young-shin acknowledged investor concerns over the disappointing results and said the company would focus on stabilizing supplies and restoring earnings in the fourth quarter.

InBody Plunges 27% Despite Profit Surge; Earnings Quality Questioned

InBody plunged 27.14% to 41,750 won, erasing all of the previous day’s 23.89% rally and more. The sell-off followed earnings that showed a sharp increase in operating profit but a steep decline in net income.

Third-quarter revenue rose 19.2% to 71.3 billion won, while operating profit jumped 95.6% to 19.3 billion won. Net profit, however, fell 53.1% to 4.4 billion won.

Kiwoom Securities cautioned that the improvement in operating profit was partly driven by temporary factors, including foreign exchange effects on costs and inventory-related accounting adjustments. Although the reported operating margin reached 27.1%, the brokerage estimated an underlying margin of 19.5%, below the second quarter’s 20.3%.

Revenue for the first nine months rose 24.1% to 213 billion won, with operating profit up 83.9% to 50.1 billion won. However, profitability is expected to weaken in the fourth quarter as temporary benefits fade and year-end expenses rise.

Shin Min-soo, an analyst at Kiwoom Securities, forecast a fourth-quarter gross margin of 76.5% and an operating margin of 15.8%, citing reduced currency benefits, the absence of tariff refunds, and seasonal bonus payments.