Buying by directors loses momentum

Insider buying is sharply down on value while the value of insider sales ticks up at exchange

PUBLISHED : Monday, 17 December, 2012, 12:00am
UPDATED : Monday, 17 December, 2012, 5:31am

Insider buying by directors slowed last week after rising for two weeks.

Selling was also down, based on regulatory filings made to the stock exchange for the second week of December.

Thirty companies reported 116 insider purchases during the week, valued at a total of HK$81.5 million, while 16 companies reported 56 insider disposals worth HK$131.3 million.

The number and value of buying trades were down from the previous week's 129 purchases worth HK$319.3 million; while insider selling was sharply down from the previous week's 26 companies that reported 111 disposals.

The sell value, however, was up from the previous week's sales worth HK$119.3 million.

Buy-back activity among listed companies fell, with 13 companies disclosing 31 repurchases worth HK$28.3 million, down from the previous week's 17 companies and 70 trades worth HK$35.1 million.

Buy-backs were reported by China Outfitters and director purchases were reported in China Innovationpay Group and Sino Biopharmaceutical.

There were sales by both directors and fund managers in VTech.

Men's casual wear retailer China Outfitters bought back shares for the first time since the stock was listed in December 2011, with 3.696 million shares bought from December 12 to 14 at an average of HK$1.45 each. The trades accounted for 42 per cent of the stock's trading volume and were made after the shares rebounded by 14 per cent from HK$1.28 on November 15.

Chief executive Zhang Yongli, chairman Peter Lo, and executive director David Sun acquired a combined 6.47 million shares from September 6 to November 21 an average of HK$1.33 each. Those were their first trades since listing at a debut price of HK$1.64. The stock closed at HK$1.51 on Friday.

Chief executive Cao Chunmeng recorded his first on-market trade in optical devices maker China Innovationpay since his appointment in July, with 47.6 million shares bought on December 12 at 21 HK cents each. The trade increased his holdings by 241 per cent to 67.42 million shares or 1.43 per cent of the issued capital.

The purchase was made on the back of a 32 per cent drop in the share price since July from 31 HK cents.

Also positive this quarter is Senrigan Capital, with an initial filing on October 26 of 38 million shares at 27 HK cents each, which boosted its stake to 249.192 million shares or 5.29 per cent. The counter closed at 22.6 HK cents on Friday.

Executive director Tse Hsin resumed buying shares of biotechnology and Chinese medicinal technology firm Sino Biopharmaceutical at a sharply higher price, with 2.93 million shares bought on December 10 at HK$3.84 each.

The trade increased his holdings to 37.816 million shares or 0.77 per cent.

The acquisition was made on the back of a 45 per cent rise in the share price since July.

The stock closed at HK$3.91 on Friday.

The Capital Group and chief executive Pang King-fai unloaded shares of hi-tech educational and consumer electronic products manufacturer VTech this month.

The Capital Group ceased to be a substantial shareholder on December 11 following the sale of 1.39 million shares at HK$90.50 each, which cut its holdings to 11.564 million shares, or 4.62 per cent. The shareholder's stake is down by 5.89 million shares or 34 per cent since October 2011.

Pang, on the other hand, sold 120,000 shares from December 3 to 4 at an average of HK$90.82 each, lowering his stake by 24 per cent to 384,000 shares or 0.15 per cent.

He also sold 113,000 shares on August 6 at HK$93.23 each.

The disposals were made at a huge profit, based on the 233,000 shares he acquired from April to July via exercise of options at HK$41.07 each. The stock closed at HK$89.85 on Friday.

Robert Halili is managing director of Asia Insider