Chinese Estates subsidiary pockets HK$26 million windfall from a quick punt in Evergrande

Chinese Estates Holdings, controlled by Hong Kong property tycoon Joseph Lau Luen-hung’s wife Chan Hoi-wan, emerged a big winner in China Evergrande Group’s share price surge, making a profit of more than HK$26 million (US$3.34 million) in just a few days.

Records from the Hong Kong stock exchange reveal that Fair Eagle Securities, a wholly-owned subsidiary of Chinese Estates, traded a high volume of Evergrande shares from mid to late May, capitalising on a sharp rally in the share price of the mainland’s top homebuilder.

On May 12, Fair Eagle bought 38.9 million Evergrande shares. But the broker sold the bulk of them over the following two trading days, with 32.4 million shares disposed on May 15, and a further 6.3 million unloaded on May 16.

Fair Eagle switched back into buying mode the following trading week. The securities firm owned by Lau’s family acquired 26.2 million Evergrande shares on May 26, bringing its total holding to 29 million shares. But on May 29, a day when Evergrande surged 23 per cent to record, Fair Eagle was back in selling mode, unloading 8.9 million shares.

By calculating the buy and sell activity during May 12-15 and May 26-29 , based on the closing price on each trading day, Chinese Estates likely make a trading gain of HK$26 million, according to calculations by the Post.

Evergrande’s shares began rising sharply from mid-May, and have since nearly doubled in value.