The Insider
by

Healthcare stocks in Hong Kong stand out as directors tone down buying and selling of company shares

PUBLISHED : Sunday, 31 January, 2016, 3:26pm
UPDATED : Monday, 16 January, 2017, 10:28am

The buying slowed while the selling among directors was low for the third straight week based on filings on the exchange in the last week of January. A total of 61 companies recorded 395 purchases worth HK$988 million versus 8 firms with 57 disposals worth HK$8.8 million. The number of companies and trades on the buying side were down from the previous week’s 76 firms and 453 acquisitions.

The buy value, however, was up from the previous week’s purchases worth HK$868 million. On the selling side, the number of companies and value were down from the previous week’s 11 firms and HK$69.4 million. The number of disposals was sharply up from the previous week’s 42 transactions.

While the buying by directors slowed last week, the buyback activity plunged with 35 companies that posted 184 repurchases worth HK$402 million. The figures were sharply down from the previous week’s 53 firms, 307 trades and HK$1.39 billion.

The buying was heavy in the health sector with buybacks in Dawnrays Pharmaceutical and insider buys in China Regenerative Medicine, Lee’s Pharmaceutical, UMP Healthcare and Modern Dental Group.

Medicine developer and manufacturer Dawnrays Pharmaceutical recorded its first buybacks since February 2015 with 760,000 shares purchased from January 28 to 29 at an average of HK$5.04 each. The trades were made on the back of the 36 per cent drop in the share price since July 2015 from HK$7.84.

READ MORE: Company directors emerge as active buyers following share price pullback

Despite the fall in the share price, the counter is still up since February 2015 from HK$3.95. The group previously acquired 3.85 million shares from January to February 2015 at an average of HK$5.10 each and 29.6 million shares from January 2006 to February 2009 at an average of HK$0.712 each. The recent buybacks bodes well for shareholders as the stock rose by an average of 13 per cent six months after the group bought shares based on 87 filings since 2006. The stock recorded a price gain six months after on 92 per cent of those filings. The stock closed at HK$5.25 on Friday.

Executive director Dai Yu Min picked up where he left off in bio-medical and healthcare products developer China Regenerative Medicine in December 2015 with 25 million shares purchased from January 15 to 27 at HK$0.45 to HK$0.33 each or an average of HK$0.354 each. The trades, which accounted for 18 per cent of the stock’s trading volume, increased his holdings to 4.141 billion shares or 24 per cent of the issued capital.

He previously acquired 19 million shares from December 29 to 30, 2015 at an average of HK$0.40 each. The purchases since the last week of December 2015 were made on the back of the drop in the share price since October 2015 from HK$0.55. Prior to his purchases in the past two months, Dai bought 11.9 million shares in May 2015 at an average of HK$0.674 each and 52.6 million shares from February to June 2011 at an average of HK$0.22 each. The counter closed at HK$0.345 on Friday.

CEO Li Xiaoyi acquired shares of biopharmaceutical products manufacturer Lee’s Pharmaceutical Holdings at lower than his sale price in September 2015 with 157,000 shares purchased from January 18 to 22 at an average of HK$7.46 each. The trades, which accounted for 24 per cent of the stock’s trading volume, increased his holdings to 54.885 million shares or 9.35 per cent of the issued capital.

The acquisitions were made on the back of the 31 per cent drop in the share price since October 2015 from HK$10.80. He previously sold 5,000 shares on September 25, 2015 at HK$10.30 each. Prior to that disposal, the CEO bought 74,000 shares on July 7, 2015 at HK$10.71 each. Prior to his trades since July 2015, the CEO sold 198,000 shares from July to September 2014 at HK$10.19 each and 1.53 million shares from May to December 2013 at HK$6.46 each. The stock closed at HK$7.14 on Friday.

Executive director Michael Sun Man Kin recorded the first corporate shareholder trades in healthcare solutions providers UMP Healthcare Holdings since the stock was listed in November 2015 with 11.1 million shares purchased from January 20 to 21 at HK$1.14 each. The trades increased his holdings by 739 per cent to 12.590 million shares or 1.71 per cent of the issued capital. The acquisitions were made on the back of the 39 per cent decline in the share price since December 2015 from HK$1.87. The director’s purchase price was sharply lower than the IPO prices of HK$1.92 to HK$2.20. The stock closed at HK$1.06 on Friday.

Chairman Chan Kwun Fung recorded the first on-market trades by a director in dental prosthetic device provider Modern Dental Group since the stock was listed on December 15, 2015 with one million shares purchased from January 14 to 20 at HK$3.20 to HK$2.91 each or an average of HK$3.01 each.

The trades, which accounted for 6 per cent of the stock’s trading volume, increased his holdings to 470.248 million shares or 47.02 per cent of the issued capital. The acquisitions were made on the back of 34 per cent drop in the share price since December 2015 from HK$4.53. The chairman’s purchase prices were lower than the IPO prices of HK$3.40 to HK$4.90. The stock closed at HK$3.08 on Friday.

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