Directors' sales drop but remain high

Individual buying activity picks up but company purchases plunge

PUBLISHED : Monday, 28 January, 2013, 12:00am
UPDATED : Monday, 28 January, 2013, 7:26am

Selling of their own company shares by directors outweighed buyers last week, with 21 companies reporting to the stock exchange 104 director disposals worth HK$218 million, compared with 18 firms that reported 60 purchases worth HK$89 million.

Although still at a high level, disposals were down from the previous week's 24 companies that reported 135 trades valued at HK$409 million.

Purchases, on the other hand, rose from 15 companies with 44 deals worth HK$33.5 million.

Meanwhile, buy-back activity plunged - only eight companies made 35 repurchases worth HK$150.9 million, compared with the previous week's 12 companies in 56 transactions valued at HK$386 million.

Two stocks that saw key insider sales were Tristate and Luk Fook.

Funds were also active sellers, with trades in Dongjiang Environmental, Weiqiao Textile and Beijing Enterprises.

Tristate chairman Peter Wang Kin-chung recorded his first on-market trades in the garment manufacturer since April last year, with 153,000 shares sold from January 14 to 23 at an average of HK$3.85 each. The trades, which accounted for 37 per cent of the stock's trading volume, reduced Wang's holdings to 185.65 million shares or 68.65 per cent of the issued capital.

The disposals were made on the back of a 30 per cent drop in the share price from May's HK$5.50.

The stock closed at HK$3.80 on Friday.

At Luk Fook, executive director Wong Hau-yeung recorded her first sale in the jewellery retailer since her appointment in October 2011. She sold 110,000 shares on Tuesday and Wednesday at an average HK$28.97 each. The trades reduced her holdings by 92 per cent to 10,000 shares.

The disposals were made on the back of a 49 per cent rebound in the share price since November last year from HK$19.48. Wong bought 70,000 shares at an average HK$18.05 each between April and July.

The stock last traded at HK$27.30.

Edmond de Rothschild Asset Management ceased to be a substantial shareholder of waste treatment services provider Dongjiang following the sale of 737,800 shares from January 4 to 23 at HK$31.69 to HK$37.75 each. The trades reduced its holdings by 30 per cent to 1.75 million shares or 4.91 per cent.

The trades were made on the back of a rebound in the share price since October, from HK$28.70.

The fund manager previously reported a disposal on March 28 of 9,000 shares at HK$30.82 each. It had bought 926,600 shares from September 27, 2011, to March 8 last year at HK$22.87 to HK$32.97 each; and 444,000 shares at HK$22.87 each on September 26.

The stock closed at HK$37.40 on Friday.

Boston Company Asset Management also ceased to be a substantial shareholder of mainland textile manufacturer Weiqiao on January 22 following the sale of 387,000 shares at HK$4.10 each. The trade reduced its holdings to 20.54 million shares or 4.97 per cent.

The disposal was made on the back of a 49 per cent rise in the share price, from HK$2.76 last month.

Boston bought 4.6 million shares at HK$3.60 to HK$3.76 each from October 4 to December 19, 2011.

The stock ended trading at HK$3.92 on Friday.

The Capital Group too ceased to be a substantial shareholder of piped natural gas distributor Beijing Enterprises on January 21 following the sale of 6.4 million shares at HK$51.38 each. The trade reduced its holdings by 11 per cent to 54.21 million shares.

Overall, the fund manager's stake is down by 35.8 million shares or 40 per cent since November.

The stock closed at HK$54.45 on Friday.

Robert Halili is the managing director of Asia Insider