Dear Dr Mwamba,
The only benefits I can think of at the moment from using a larger punch over a needle are as follows.
A self supporting cylindrical shaft that similer to one created with a small punch, would force the skin to bridge the gap created. In bridging the gap the body is creating tissue to fill the hole. This creation of new tissue contains all the nessecary cells and growth factors in their correct states to form new follicules, what we need to do is push them in the right direction. This is hopefully where Nigams new solution comes in.
I spoke to a chap who sold an Acell competitor ECM. He stated that ECM has never once created new hair follicules in the skin when. It helps with healing but it does not generate new follicules.