The Insider
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Shangri-La Asia hotels and these other seven China companies all saw insider buying in recent weeks

Stock buybacks by company directors remained high during the first week of the fourth quarter

PUBLISHED : Sunday, 09 October, 2016, 3:17pm
UPDATED : Monday, 16 January, 2017, 10:28am

The buying remained high while the selling among directors fell based on filings on the Hong Kong Stock Exchange for the week ended October 7. A total of 26 companies recorded 112 purchases worth HK$82 million versus 12 firms with 72 disposals worth HK$152 million. The number of companies and trades on the buying side were consistent with the previous week’s 26 firms and 104 acquisitions. The buy value, however, was down from the previous week’s purchases worth HK$103 million. On the selling side, the number of disposals was slightly up from the previous week’s 67 trades but the number of companies and value were sharply down from the previous week’s 18 firms and HK$257 million.

Meanwhile, the buyback activity fell with 17 companies that posted 80 repurchases worth HK$1.21 billion. The figures were down from the previous week’s 23 firms, 123 trades and HK$1.25 billion. The huge buyback value was mainly due to blue chip HSBC Holdings as the Group bought back a further 14.76 million shares worth HK$877 million last week. That brought the buybacks by the Group since August to 131.2 million shares worth HK$7.58 billion. The repurchases by HSBC in the past three months has resulted in the largest turnover in buyback activity since July last year.

The bulk of the significant trades last week were rare purchases in Easy Repay Finance, Shangri-la Asia Limited and Tianyi (Summi) Holdings. Meanwhile, directors of China Medical System, Zhongsheng Group, Goldin Properties resumed buying at higher than their acquisition prices earlier this year. Two other stocks worth noting are Brightoil Petroleum and EcoGreen Fine Chemicals Group as directors resumed buying following the sharp rebound in their share prices.

Easy Repay Finance & Investment Limited

Money lender and property investor Easy Repay Finance & Investment Limited recorded its first buybacks since January 2010 with 125,000 shares purchased from September 28 to October 4 at an average of HK$0.706 each. The trades were made on the back of the 41 per cent drop in the share price since July from HK$1.20. Despite the fall in the share price, the counter is still up since December 2015 from HK$0.52. The Group previously acquired 7.1 million shares in January 2010 at an average of HK$0.18. The counter closed at HK$0.68 on Friday.

Shangri-La Asia Limited

Deputy chairman Kuok Hui Kwong recorded her first on-market trades in hotel play Shangri-La Asia Limited since October 2015 with 30,000 shares purchased during two consecutive days from October 3 at HK$8.50 each. The trades increased her holdings to 5.031 million shares or 0.14 per cent of the issued capital. The purchases were made on the back of the 12 per cent rebound in the share price since the last week of June from HK$7.62. The counter is also up since February from HK$6.80. She previously acquired 550,000 shares from September to October 2015 at HK$6.69 to HK$7.13 each or an average of HK$6.98. The purchases by Kuok since September 2015 are her first on-market trades since her appointment in October 2014. The stock closed at HK$8.44 on Friday.

Tianyi (Summi) Holdings Limited

Chairman and chief executive Sin Ke recorded his first on-market trades in frozen concentrated orange juice producer and distributor Tianyi (Summi) Holdings since June 2015 with 5.9 million shares purchased from September 29 to October 3 at HK$1.06 to HK$1.11 each, or an average of HK$1.08 each. The trades, which accounted for 14 per cent of the share’s trading volume, increased his holdings to 692.50 million shares or 51.38 per cent of the issued capital. The acquisitions were made after the stock rebounded by as much as 59 per cent from HK$0.70 in August. Despite the rebound in the share price, the counter is still down since December 2015 from HK$1.50. The chairman previously acquired 13 million shares from May to June 2015 at HK$1.11 to HK$1.50 each or an average of HK$1.23 each, 4.09 million shares in November 2012 at an average of HK$1.07 each and 16,000 shares in July 2012 at HK$1.23 each. The purchases by the chairman starting in July 2012 were his first on-market trades since the stock was listed in July 2008. The stock closed at HK$1.09 on Friday.

China Medical System Holdings Limited

Chairman and chief executive Lam Kong resumed buying shares of mainland pharmaceutical firm China Medical System after the stock rose by 28 per cent from his purchase price in May with 88,000 shares purchased on September 30 at HK$13.20 each. The trade increased his holding to 1.156 billion shares or 46.49 per cent of the issued capital. He previously acquired 631,000 shares from May 17 to 19 at an average of HK$10.32 each. The purchases since May were made on the back of the rebound in the share price since February from HK$8.54. Prior to his trades this year, the chief executive acquired 101,000 shares in September 2015 at HK$9.17 each, 517,000 shares in May 2015 at an average of HK$12.84, and 4.23 million shares from April 2011 to May 2014 at HK$3.27 to HK$9.10 each, or an average of HK$7.47. The stock closed at HK$13.02 on Friday.

Zhongsheng Group Holdings Limited

Chairman Huang Yi resumed buying shares of automobiles retailer Zhongsheng Group at higher than his acquisition prices from July 2015 to June this year with 497,000 shares purchased on September 30 at HK$7.30 each. The trade increased his holdings to 1.3 billion shares or 60.55 per cent of the issued capital. Although the chairman acquired shares last month at higher than his acquisition prices from July 2015 to June this year, the purchase was made after the stock fell by 11 per cent from HK$8.19 on September 15. Despite the fall in the share price, the counter is still up since the last week of June from HK$4.15. He previously acquired 16.83 million shares from April 1 to June 24 at HK$3.68 to HK$4.29 each or an average of HK$3.97 each. Prior to his purchases this year, the chairman acquired 10.57 million shares in July 2015 at HK$4.18 to HK$4.81 each, or an average of HK$4.52, and 25.3 million shares from August 2011 to October 2014 at HK$12.96 to HK$7.60 each, or an average of HK$9.25. The stock closed at HK$7.40 on Friday.

Goldin Properties Holdings Limited

Chairman and chief executive Pan Sutong resumed buying shares of property developer Goldin Properties Holdings at higher than his acquisition price earlier this year with 14,000 shares purchased on October 3 at HK$6.09 each. The trade increased his holdings to 2.30 billion shares or 64.4 per cent of the issued capital. Although the chairman resumed buying this month at a higher price, the acquisition was made on the back of a 19 per cent drop in the share price since the last week of August from HK$7.50. Despite the fall in the share price, the counter is still up since May from HK$2.84. He previously acquired 866,000 shares from March 8 to 10 at an average of HK$3.63 each, 2.2 million shares from July to August 2015 at HK$6.00 to HK$5.47 each, or an average of HK$5.64 each, and 2.5 million shares from July to August 2014 at HK$4.70 to HK$4.10 each, or an average of HK$4.42 each. Prior to his purchases since 2014, the chairman acquired 109.5 million shares from January 2011 to July 2013 at HK$1.65 to HK$4.90 each or an average of HK$2.67 and 146.2 million shares from March 2005 to December 2010 at HK$1.86 to HK$7.51 each, or an average of HK$4.43. The stock closed at HK$6.15 on Friday.

Brightoil Petroleum (Holdings)

Oil-related stocks have risen sharply in the past quarter but that did not deter chairman and chief executive Sit Kwong-lam of oil & gas exploration firm Brightoil Petroleum (Holdings) from buying more shares. The chairman picked up where he left off in July with 4.5 million shares purchased from September 29 to October 5 at an average of HK$2.35 each. The trades, which accounted for 37 per cent of the stock’s trading volume, increased his holdings to 7.3 billion shares or 71.81 per cent of the issued capital. The purchases were made on the back of an 18 per cent rebound in the share price since September 5 from HK$1.99. The chairman previously acquired 39.6 million shares from June 10 to July 27 at HK$2.53 to HK$2.32 each, or an average of HK$2.37 each, 10.4 million shares from April 27 to May 24 at HK$2.59 to HK$2.30 each, or an average of HK$2.37 each, and 43 million shares from January 6 to March 29 at HK$2.60 to HK$1.92 each, or an average of HK$2.17 . Prior to his purchases this year, Sit acquired 9.69 million shares in December 2015 at HK$2.18 to HK$2.53 each, or an average of HK$2.27, and 41.5 million shares from May to July 2015 at HK$2.33 to HK$3.41 each, or an average of HK$2.70. The stock closed at HK$2.37 on Friday.

EcoGreen Fine Chemicals Group Limited

Chairman Yang Yi Rong picked up where he left off in fine chemical products manufacturer and distributor EcoGreen Fine Chemicals Group in July with 3.67 million shares purchased on October 5 at HK$1.65 each. The trade increased his holdings to 271.021 million shares or 41.78 per cent of the issued capital. The acquisition was made on the back of the 14 per cent rise in the share price since August from HK$1.45. He previously acquired 2.36 million shares from June 1 to July 28 at HK$1.73 to HK$1.35 each, or an average of HK$1.55. Prior to his purchases this year, Yang acquired 1.58 million shares from October to November 2015 at HK$1.87 to HK$1.75 each, or an average of HK$1.82, 1.03 million shares in January 2013 at an average of HK$1.63, 1.9 million shares from June to October 2011 at HK$2.59 to HK$1.81 each or an average of HK$2.17, and 2.1 million shares from October to December 2008 at HK$0.72 to HK$1.17 each, or an average of HK$0.92. Investors should note that the stock rose by an average of 16 per cent six months after the chairman bought shares based on 100 purchases since 2008. The stock recorded a price gain six months after on 52 per cent of those acquisitions. The stock closed at HK$1.71 on Friday.

Robert Halili is managing director of Asia Insider

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