THE INSIDER
The Insider
by

Fall in market sparks significant rise in buying by directors

Bulk of purchases last week were in stocks that recorded price falls

PUBLISHED : Sunday, 17 January, 2016, 2:40pm
UPDATED : Monday, 16 January, 2017, 10:28am

Another fall in the market resulted in a significant rise in the buying by directors, with 78 companies recording 443 purchases worth HK$732 million based on exchange filings in the second week of the year. The figures were sharply up from the previous week’s 50 firms, 269 purchases and HK$352 million.

The selling, on the other hand, was low with 9 companies recording 43 disposals worth HK$75 million. The number of firms and trades were not far off from the previous week’s 8 companies and 36 disposals while the sell value was sharply down from the previous week’s HK$293 million.

Aside from directors, the buyback activity rose with 49 companies posting 255 repurchases worth HK$1.13 billion. The number of firms and trades were sharply up from the previous week’s 35 companies and 202 transactions. The value was down from the previous week’s HK$1.382 billion.

The bulk of the purchases last week were in stocks that recorded price falls with rare insider buys in D&G Technology, CT Environmental, Huazhang Technology and Xingda International.

Chairman Choi Hung-nang resumed buying shares of asphalt mixing plants builder D&G Technology at lower than his previous acquisition prices with 2.14 million shares purchased from January 7 to 8 at HK$0.97 each. The trades increased his holdings to 350.888 million shares or 56.66 per cent of the issued capital. The purchases were made on the back of a 38 per cent drop in the share price since October 2015 from HK$1.58. He previously acquired 3.05 million shares in July at an average of HK$1.24 each. The purchases by Choi since July are his first on-market trades since the stock was listed in May. The stock closed at HK$0.93 on Friday.

Executive director Gu Yaokun resumed buying shares of wastewater and industrial water supply services firm CT Environmental at a lower price with 500,000 shares purchased on January 11 at HK$2.15 each. The trade increased his holdings to 226.560 million shares or 3.59 per cent of the issued capital. The acquisition was made on the back of an 18 per cent drop in the share price since December 23 from HK$2.61. He previously acquired 2 million shares on December 22 at HK$2.49 each. The purchases by Gu since last month are his first on-market trades since his appointment in November. The stock closed at HK$2.11 on Friday.

Director Zhu Genrong recorded the first on-market trades by a director in industrial automation systems and sludge treatment products developer and manufacturer Huazhang Technology since the company moved its listing from the Growth Enterprise Market to the main board in October 2014, with 304,000 shares purchased from January 7 to 14 at an average of HK$2.46 each. The trades increased his holdings to 204.304 million shares or 67.95 per cent of the issued capital. The purchases were made on the back of a 52 per cent drop in the share price since June from HK$5.14. Despite the fall in the share price, the counter is still up since June 2013 from HK$1.21. Investors should note that there were buybacks by the company in the second half of last year with 38,000 shares purchased on December 28 at HK$2.43 each and 4.35 million shares from September 30 to October 13 at an average of HK$3.35 each. The counter closed at HK$2.42 on Friday.

Chairman Liu Jinlan recorded his first on-market trade in mainland radial tyre cords manufacturer Xingda International since the stock was listed in December 2006 with 2.476 million shares purchased from January 7 to 12 at of HK$1.53 to HK$1.41 each or an average of HK$1.47 each. The trades, which accounted for 23 per cent of the stock’s trading volume, increased his holdings to 576.367 million shares or 38.75 per cent of the issued capital. The purchases were made after the stock fell by as much as 24 per cent from HK$1.85 in October. The counter is also sharply down since December 2013 from HK$4.36. Mr. Liu was appointed to the board in 1994. Investors should note that there were buybacks by the company last year with nearly 28 million shares purchased from January to October at HK$2.70 to HK$1.49 each or an average of HK$1.89 each. Before the buybacks last year, the company acquired 9.5 million shares from October to December 2014 at an average of HK$2.73 each and 21.3 million shares from September to October 2007 at an average of HK$2.55 each. The stock closed at HK$1.44 on Friday.

Robert Halili is managing director of Asia Insider

business-article-page