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Director activity falls sharply in value and number for second straight week

Bulk of the acquisitions made following the fall in share prices with purchases in Chevalier International, Guangdong Investment Limited, Cosmo Lady (China) Holdings, and Sheen Tai Holdings

PUBLISHED : Sunday, 05 February, 2017, 5:51pm
UPDATED : Sunday, 05 February, 2017, 11:06pm

Director activity fell for the second straight week, based on filings on the Hong Kong Stock Exchange during the holiday-shortened week of February 1 to 3, with 13 companies recording 37 purchases worth HK$83 million versus five firms with 17 disposals worth HK$1.9 million.

The figures were sharply down from the previous week’s 5-day totals of 30 companies, 157 purchases and HK$303 million on the buying side and 14 firms, 50 disposals and HK$121 million on the selling side.

Aside from directors, the buyback activity fell for the second straight week with six companies that posted 19 repurchases worth HK$61 million based on filings from Monday to Thursday.

The number of firms and trades were sharply down from the previous week’s 11 companies and 51 repurchases. The value, however, was consistent with the previous week’s turnover of HK$98 million.

Despite the short trading week, there were several significant director purchases last week.

The bulk of the acquisitions, however, were made following the sharp fall in share prices with purchases in Chevalier International, Guangdong Investment Limited, Cosmo Lady (China) Holdings, Sheen Tai Holdings.

Meanwhile, investors should watch out for Hing Lee Holdings and Modern Dental Group as their CEOs of these two companies resumed buying last week at higher prices.

Co-chairman and managing director Kuok Hoi Sang recorded his first on-market trades in Chevalier International Holdings since 1993 with 34,000 shares purchased from January 25 to February 1 at an average of HK$12.05 each

Co-chairman and managing director Kuok Hoi Sang recorded his first on-market trades in the construction and engineering firm, property insurance and investment services provider and restaurants and bars operator Chevalier International Holdings, based on filings on the Exchange since 1993 with 34,000 shares purchased from January 25 to February 1 at an average of HK$12.05 each.

The trades, which accounted for 32 per cent of the stock’s trading volume, increased his holdings by 30 per cent to 148,000 shares or 0.05 per cent of the issued capital. The purchases were made on the back of the 24 per cent drop in the share price since August 2015 from HK$15.90. Despite the fall in the share price, the counter is still up since May 2012 from HK$7.93. Kuok joined the Group in 1972. The stock closed at HK$12.18 on Friday.

Non-executive director Li Wai Keung and Independent non-executive director David Li Kwok Po acquired shares of water distributor and electric power supplier and property investor Guangdong Investment Limited with a combined 1.5 million shares purchased from January 24 to 25 at an average of HK$10.06 each.

The purchases were made on the back of the 22 per cent drop in the share price since September 2016 from HK$12.82. Despite the fall in the share price, the counter is still up since January 2016 from HK$9.20. Li Wai Keung recorded his first on-market buy since his appointment in July 2006 with 500,000 shares purchased on January 25 at HK$10.01 each. The trade increased his holdings by 22 per cent to 2.743 million shares or 0.04 per cent of the issued capital.

He previously sold 2.3 million shares from April to May 2014 at an average of HK$8.70 each, 231,000 shares in September 2007 at HK$4.86 each and 7.700 million shares in July 2007 at HK$4.70 to HK$5.09 each or an average of HK$4.87 each.

David Li, on the other hand, recorded his first on-market trade since June 2012 with one million shares purchased on January 24 at HK$10.08 each, which boosted his stake by 9 per cent to 12.000 million shares or 0.19 per cent.

Non-executive director Li Wai Keung and independent non-executive director David Li Kwok Po acquired shares of water distributor and electric power supplier and property investor Guangdong Investment Limited with a combined 1.5 million shares at an average of HK$10.06 each

He previously acquired 3 million shares from January to June 2012 at HK$4.83 to HK$5.57 each or an average of HK$5.18 each, 850,000 shares from September to October 2010 at HK$3.79 to HK$4.08 each or an average of HK$3.97 each and 550,000 shares in April 2009 at HK$3.36 each. Li, who was appointed to the board in June 1998, is also the chairman & CEO of Hong Kong-listed Bank of East Asia Limited. The stock closed at HK$10.18 on Friday.

Chairman and CEO Zheng Yao Nan recorded his first on-market trades in female intimate wear products developer, manufacturer and marketer Cosmo Lady (China) Holdings since December 2015 with 3.37 million shares purchased from January 23 to 25 at HK$2.68 to HK$2.51 each or an average of HK$2.58 each. The trades, which accounted for 5 per cent of the stock’s trading volume, increased his holdings to 1.177 billion shares or 61.75 per cent of the issued capital.

The purchases were made on the back of the 26 per cent drop in the share price since October 2016 from HK$3.47.

The counter is also down since January 2016 from HK$6.99. He previously acquired 583,000 shares in December 2015 at HK$6.65 to HK$6.92 each or an average of HK$6.75 each.

The purchases by Zheng since December 2015 are his first on-market trades since the stock was listed in June 2014. The chairman’s last purchase prices were lower than the IPO prices of HK$3.27 to HK$4.42.

Also positive this quarter is Prime Capital Management Company Limited with an initial filing on January 23 of 47.52 million shares at HK$2.66 each, which raised its interest by 51 per cent to 7.41 per cent. The group acquired a further 15 million shares on January 26 at HK$2.37 each, which boosted its stake by 11 per cent to 156.288 million shares or 8.2 per cent. The stock closed at HK$2.29 on Friday.

Executive chairman Guo Yu Min resumed buying shares of cigarette packaging materials manufacturer and distributor Sheen Tai Holdings at lower than his trade prices in 2016 with 20 million shares purchased from January 24 to 26 at HK$0.72 each.

The trades, which accounted for 84 per cent of the stock’s trading volume, increased his holdings to 1.505 billion shares or 68.93 per cent of the issued capital. The purchases were made on the back of the 15 per cent drop in the share price since December 2016 from HK$0.85.

He previously acquired 27.9 million shares from September to October 2016 at HK$0.81 to HK$0.76 each or an average of HK$0.795 each and a net 63.5 million shares from January to July 2016 at HK$0.82 to HK$1.13 each or an average of HK$0.92 each. Prior to his transactions since 2016, the chairman acquired 27.2 million shares in November 2012 at an average of HK$0.28 each (adjusted for 1 into 4 share split in September 2015). The counter closed at HK$0.77 on Friday.

Chairman and CEO Sung Kai Hing resumed buying shares of home furniture designer and manufacturer Hing Lee (HK) Holdings at higher than his previous acquisition prices with 3.88 million shares purchased from January 20 to 26 at HK$0.55 to HK$0.66 each or an average of HK$0.64 each.

The trades, which accounted for 23 per cent of the stock’s trading volume, increased his holdings to 280.475 million shares or 34.79 per cent of the issued capital. He previously acquired 1.5 million shares on January 5 at HK$0.45 each and 1.3 million shares purchased from December 16 to 30, 2016 at an average of HK$0.42 each.

Prior to his purchases since December 2016, Sung acquired 956,000 shares in June 2016 at an average of HK$0.45 each and 6.72 million shares in April 2016 at HK$0.36 to HK$0.41 each or an average of HK$0.38 each. The acquisitions by the chairman since April 2016 his first on-market trades since the stock was listed in 2009. The counter closed at HK$0.65 on Friday.

CEO Ngai Shing Kin resumed buying shares of dental prosthetic device provider Modern Dental Group at higher than his acquisition price in December 2016 with 1.25 million shares purchased on January 26 at HK$3.09 each.

The trade increased his holdings to 98.041 million shares or 9.8 per cent of the issued capital. The acquisition was made on the back of the 33 per cent rebound in the share price since December 8, 2016 from HK$2.32. He previously acquired 162,000 shares from December 5 to 6, 2016 at an average of HK$2.47 each.

The purchases by Ngai since December 2016 are his first on-market trades since the stock was listed in December 2015. The CEO’s purchase prices were lower than the IPO prices of HK$3.40 to HK$4.90. Investors should also note that executive chairman Chan Kwun Fung purchased 663,000 shares from November 29 to December 6, 2016 at HK$2.53 to HK$2.43 each or an average of HK$2.48 each, which boosted his stake to 472.906 million shares or 47.29 per cent.

He previously acquired 1.58 million shares from April to May 2016 at an average of HK$3.01 each and 1.4 million shares from January to March 2016 at HK$3.20 to HK$2.83 each or an average of HK$2.99 each. The stock closed at HK$3.12 on Friday.

Robert Halili is managing director of Asia Insider

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