The Insider

Hong Kong directors return to step up buying pace, but selling still high

Purchases by executives in AMS, Kingboard, Allied and Lippo raise hopes for rally in stocks

PUBLISHED : Sunday, 18 October, 2015, 11:33pm
UPDATED : Monday, 19 October, 2015, 12:40am

Buying by directors rose for the first time in four weeks, with 53 companies making 255 purchases worth HK$376 million, according to filings to the stock exchange last week. The number of firms and trades were up from the previous week's 45 and 229, respectively, but the value was down from HK$472 million.

Selling remained high, with 14 companies posting 87 disposals worth HK$131 million, compared with 54 transactions in 16 companies for HK$173 million previously.

The bulk of the significant trades were insider purchases in AMS Public Transport Holdings, Kingboard Chemical Holdings, Allied Group and Lippo. The directors who bought was good news for shareholders as share prices tend to rise in the long term after their acquisitions.

Executive director Ng Sui-chun resumed buying shares of AMS at a higher price, picking up 144,000 shares from October 9 to 13 at HK$1.28 each. The trades, which accounted for 88 per cent of the stock's trading volume, increased her holdings to 173.738 million shares or 65.28 per cent of the issued capital. The purchases were made on the back of a 14 per cent rise in the share price since August from HK$1.12.

Ng previously bought 184,000 shares on July 8 at HK$1.07 each. She also bought 3.14 million shares from January to April last year at an average of HK$1.08 each and 100,000 shares from July to October 2013 at HK$1.30 each.

The stock rose an average 10 per cent six months after Ng's purchases, based on 519 deals since 2004.

The stock closed at HK$1.28 on Friday.

Kingboard's chief executive Chang Wing-yiu recorded his first trade in the laminates and copper foil manufacturer since May 2011 with 133,000 shares bought on October 9 at HK$10.15 each. The trade increased his holdings to 13.191 million shares or 1.28 per cent and was made after a 35 per cent drop in the share price since June from HK$15.56.

Chang previously bought 20,000 shares in May 2011 at HK$36.80 each and 20,000 shares in September 2010 at HK$37.23 each. They rose an average 21 per cent six months after his purchases, based on 77 transactions since 1997.

Kingboard closed at HK$10.64 on Friday.

Allied's chief executive Lee Seng Hui resumed buying shares of the financial services firm and property investor at a higher price - 512,000 shares on October 14 at HK$36.85 each. The trade increased his holdings to 131.729 million shares or 71.88 per cent.

Lee previously bought 2.5 million shares from September 10 to 18 at an average of HK$33.60 each after the stock fell from HK$50.95 in June. He also bought 1.5 million shares at an average of HK$33.79 each in September last year and 2.9 million shares from November 2013 to January last year at HK$29.62 each.

The stock rose an average 8 per cent six months after Lee's purchases, based on 87 transactions since 1997.

The stock closed at HK$37.55 on Friday.

Chairman Stephen Riady resumed buying shares of property play Lippo at lower than previous purchase prices. He snapped up 4.8 million shares from October 5 to 13 at HK$4.19 to HK$4.70 each, or an average of HK$4.48 each. The trades, which accounted for 83 per cent of the stock's trading volume, increased his holdings to 331.778 million shares or 67.28 per cent.

Riady previously bought 7.7 million shares on April 27 at HK$5 each and 400,000 shares in May 2003 at HK$1.01 each. The stock rose an average 5 per cent six months after he bought, based on 88 deals since 1993.

The counter last traded at HK$4.52 on Friday.

Robert Halili is the managing director of Asia Insider