Stock sales put the spotlight on Huishan Dairy chairman
Share buybacks seen in Cheung Kong, Agile Property, Human Health Holding and China SCE Property
The buying by directors rose for the sixth straight week based on filings on the Hong Kong stock exchange from March 20 to 24 with 21 companies that recorded 77 purchases worth HK$99.7 million. The number of firms and trades were sharply up from the previous week’s 15 companies and 61 purchases. The buy value, however, was down from the previous week’s acquisitions worth HK$139 million. The selling, on the other hand, rose for the second straight week with 10 companies that recorded 55 disposals worth HK$344 million. The number of disposals was not far off from the previous week’s 59 transactions while the number of companies and value were up from the previous week’s eight firms and HK$207 million.
Aside from directors, the buyback activity rose with 11 companies that posted 39 repurchases worth HK$1.616 billion based on exchange filings from March 17 to 23 (Friday to Thursday). The figures were up from the seven firms, 19 trades and HK$1.112 billion in the previous five-day period.
Although directors are on a six-week heavy buying streak, the top story last week was a disposal in China Huishan Dairy by chairman and chief executive officer Yang Kai. The chairman was the top seller last week in terms of value with HK$199 million worth of sales. The timing of the sale, however, is questionable as it was made a week before the company met its creditors which resulted in a major price plunge the following day.
On the positive side, Cheung Kong Property Holdings resumed buying back at higher than its previous acquisition prices. The recent buybacks are consistent with chairman Li Ka-Shing’s recent statement that he expects the Hong Kong property market to remain buoyant this year. On the directors’ side, there were rare insider buys in China SCE Property Holdings and Agile Property Holdings following the sharp gain in their share prices. Lastly, there were first-time buys in Human Health Holdings following the sharp fall in the share price.
Chairman & CEO Yang Kai recorded his first sales in dairy products producer China Huishan Dairy Holdings since the stock was listed in September 2013 with 68.25 million shares sold from March 16 to 17 at an average of HK$2.91 each. The trades reduced his holdings to 9.912 billion shares or 73.56 per cent of the issued capital. The sale was made a week before the group held a meeting with 23 local creditor banks on Thursday. The meeting spooked the market as the counter plunged by as much as 91 per cent the following day to 42 HK cents. The stock was suspended from trading after the morning session on Friday. The timing of the chairman’s sale will likely result in a Securities and Futures Commission investigation as the chairman managed to avoid a loss of HK$170 million based on his average sale price of HK$2.91 each. The fact that he sold heavily for the first time a week prior to meeting the company’s creditors will attract more scrutiny. Prior to the sale, the chairman acquired 45.83 million shares in December 2016 at an average of HK$2.76 each, 35.6 million shares in February 2016 at an average of HK$2.94 each and 1.1 billion shares from July to October 2015 at HK$1.41 to HK$2.92 each or an average of HK$2.28 each. Aside from those purchases, the chairman acquired 7.67 million shares in January 2015 at an average of HK$1.35 each and 1.9 million shares in December 2014 at HK$1.20 each. In an interview with mainland news portal Netease, the chairman said that he was absolutely not prepared to see the shares crash. His recent disposals say otherwise.
Property developer Cheung Kong Property Holdings resumed buying back at higher than its previous acquisition prices with 6.29 million shares purchased on March 23 at HK$53.75 each. The trade was made after the stock rebounded by 6 per cent from HK$50.80 on March 9. The group previously acquired 23.8 million shares from January 16 to 20 at an average of HK$51.17 each and 21.5 million shares in December 2016 at an average of HK$51.38 each. Prior to the buybacks since December 2016, the company acquired 646,000 shares in May 2016 at HK$45.24 each and 13.5 million shares in March 2016 at HK$46.73 each. The stock closed at HK$54.20 on Friday.
Chairman and president Wong Chiu Yeung recorded his first trade in mainland property developer China SCE Property Holdings since August 2013 with 2 million shares purchased on March 21 at HK$2.96 each. The trade increased his holdings to 1.973 billion shares or 57.64 per cent of the issued capital. The acquisition was made on the back of the 28 per cent rise in the share price since December 2016 from HK$2.30. The counter is also up since March 2015 from HK$1.37. He previously acquired 2 million shares in August 2013 at an average of HK$2.02 each and one million shares in May 2010 at HK$2.28 each. The stock closed at HK$3.10 on Friday.
Vice chairman Chan Cheuk Yin recorded his first trade in mainland property developer Agile Property Holdings since July 2013 with 500,000 shares purchased on March 21 at HK$7.09 each. The trade increased his holdings to 2.468 billion shares or 63.03 per cent of the issued capital. The acquisition was made on the back of the 81 per cent rise in the share price since December 2016 from HK$3.92. The counter is also up since September 2015 from HK$3.48. Despite the rise in the share price, the stock is still down since October 2013 from HK$9.34. He previously acquired 1.5 million shares from March to July 2013 at HK$10.02 to HK$7.79 each or an average of HK$8.87 each, 2 million shares from April to May 2010 at an average of HK$8.64 each and 10 million shares from July to October 2008 at HK$7.21 to HK$2.06 each or an average of HK$5.07 each. The stock closed at HK$7.25 on Friday.
Chairman and chief executive officer Chan Kin Ping recorded his first on-market trades in integrated healthcare services provider Human Health Holding since the stock was listed in April 2016 with 1.36 million shares purchased from March 20 to 22 at an average of HK$1.60 each. The trades, which accounted for 38 per cent of the stock’s trading volume, increased his holdings to 253.708 million shares or 70.18 per cent of the issued capital. The purchases were made on the back of the 19 per cent drop in the share price since January from HK$1.97. The counter is also down since May 2016 from HK$3.22. The chairman’s purchase price was slightly higher than the initial public offering price of HK$1.51. The stock closed at HK$1.66 on Friday.
Robert Halili is managing director of Asia Insider