Hong Kong’s insider buying garners momentum
Insider buys seen at Phoenix Healthcare Group and China Yongda Automobiles Services, while a rare disposal was reported at Anta Sports Products
The buying was high for a second straight week while the selling among directors rebounded based on filings on the stock exchange from May 22 to 26.
A total of 46 companies recorded 200 purchases worth HK$139 million (US$17.84 million) versus 14 firms with 90 disposals worth HK$257 million. The number of companies on the buying side was sharply up from the previous week’s 38 firms while the number of trades was consistent with the previous week’s 205 purchases. The buy value, however, was sharply down from the previous week’s acquisitions worth HK$252 million. On the selling side, the number of companies was down from the previous week’s 17 firms while the number of trades was consistent with the previous week’s 92 disposals. The high number of trades translated into a huge sell value as the sales last week were sharply up from the previous week’s disposals worth HK$102 million.
While the buying by directors was high last week, the buyback activity slowed with 23 companies that posted 93 repurchases worth HK$676 million based on buybacks from May 19 to 24.
There were several bold moves by directors last week with purchases recorded by three executive directors in Phoenix Healthcare Group and a rare acquisition by the chairman of China Yongda Automobiles Services following the sharp rebound in their share prices. On the flip side, there were rare disposals by an executive director in Anta Sports Products following the sharp fall in the share price. Although the disposals were options-related, the trades are semi-bearish signals as the immediate sale indicate the lack of confidence by the director on the upside potential of the stock.
There was considerable insider buying of health care services provider Phoenix Healthcare Group with a combined 805,000 shares purchased on May 19 at an average of HK$11.05 each. The trades were made on the back of the 19 per cent rebound in the share price since the last week of March from HK$9.31. Chief executive officer Wu Po Tao recorded his first on-market trade since his appointment in October 2016 with 273,000 shares purchased on May 19 at HK$10.94 each. The trade increased his holdings by 9 per cent to 3.449 million shares or 0.27 per cent of the issued capital. Vice Chairman Cheng Libing, on the other hand, acquired shares above his sale price in June 2016 with 273,000 shares purchased on May 19 at HK$10.98 each. The trade boosted his stake by 29 per cent to 1.201 million shares or 0.09 per cent. He previously sold 20,000 shares in June 2016 at HK$10.37 apiece. Prior to that sale, the Cheng acquired a net 739,000 shares in May 2016 at an average of HK$10.97 each. Cheng was appointed to the board in February 2016. Lastly, General manager Xu Ze Chang purchased 260,000 shares on May 19 at HK$11.26 each, which increased his holdings by 9 per cent to 3.208 million shares or 0.25 per cent. He previously sold 61,000 shares in May 2016 at HK$10.54 each. Mr. Xu joined the group in 2004.
Also positive this month are Commonwealth Bank of Australia (CBA) and substantial shareholder Xu Baorui. CBA reported an initial filing on May 11 of 4.47 million shares at HK$10.40 each, which boosted its stake by 7 per cent to 66.077 million shares or 5.1 per cent. Xu Baorui, on the other hand, acquired 1.6 million shares on May 8 at HK$10.16 each, which increased his holdings to 183 million shares or 14.11 per cent. The stock closed at HK$10.72 on Friday.
Chairman Cheung Tak On recorded his first on-market trade in new and used vehicles distributor and automobile rentals services provider China Yongda Automobiles Services Holdings since July 2015 with 500,000 shares purchased on May 23 at HK$6.85 each. The trade increased his holdings to 653.38 million shares or 40.25 per cent of the issued capital. The acquisition was made on the back of the 134 per cent rebound in the share price since July 2016 from HK$2.93. He previously acquired 1.2 million shares in July 2015 at an average of HK$4.32 each, 500,000 shares in December 2014 at an average of HK$5.47 each and 105,000 shares in April 2013 at an average of HK$8.19 each. Cheung was appointed to the board in January 2012. The sentiment is not entirely positive this month as president Xu Yue sold 341,000 shares from May 2 to 4 at an average of HK$7.19 each, which lowered his stake to 3.920 million shares or 0.26 per cent. He previously sold 159,000 shares from December 2015 to January 2016 at an average of HK$5.90 each. Mr. Xu was appointed as president in January 2012. The stock closed at HK$6.93 on Friday.
Chief operating officer Lai Shi Xian recorded his first on-market trades in sports footwear and apparel developer, manufacturer and distributor Anta Sports Products since the stock was listed in July 2007 with 3.5 million shares sold from May 18 to 22 at an average of HK$21.74 each. The trades reduced his holdings to 162.625 million shares or 6.07 per cent of the issued capital. The disposals were made on the back of the 14 per cent drop in the share price since January from HK$25.15. The sales were made at a profit based on the 3.5 million shares that he acquired via exercise of options from May 18 to 22 at HK$4.22 each. Lai joined the Group in March 2003. The counter closed at HK$22.20 on Friday.
Robert Halili is managing director of Asia Insider