CIG shares plummeted 11.60% intraday on Wednesday, erasing gains from the prior session as the stock opened sharply lower.

The sell-off was driven by reports that the US Federal Communications Commission is drafting a ban on importing Chinese-manufactured data center optical modules, citing security risks. As CIG's core business is the research, development, and sale of high-speed optical modules, the proposed ban presents a direct threat to its growth prospects. The decline was exacerbated by profit-taking after the stock surged nearly 20% in the previous trading session, while the broader communications equipment sector also came under pressure.

Market participants suggest that a strict ban remains unlikely given Chinese manufacturers' dominant market share in the 800G/1.6T segment, though short-term sentiment remains fragile. On a positive note, a major shareholder recently increased holdings, indicating longer-term confidence in the company's fundamentals.