THE INSIDER ROBERT HALILI
The Insider
by

Approach of reporting season sees buying by directors fall

Chairman of cosmetics retailer L’Occitane International increases stake

PUBLISHED : Tuesday, 09 February, 2016, 3:01pm
UPDATED : Monday, 16 January, 2017, 10:28am

Buying by directors fell for the second straight week in the first week of this month with 36 companies recording 170 purchases worth HK$313 million based on stock exchange filings. The figures were sharply down from the previous week’s 61 firms, 395 purchases and HK$988 million.

Meanwhile, selling was low for the fourth straight week with six companies recording 37 disposals worth HK$65 million. The number of firms and trades were down from the previous week’s eight companies and 57 disposals. The value, however, was sharply up from the previous week’s sales worth HK$9 million.

Aside from directors, buyback activity plunged last week with 23 firms posting 105 repurchases worth HK$185 million. The figures were sharply down from the previous week’s 36 companies, 191 trades and HK$427 million.

The sharp fall in buying in the past two weeks was likely due to the upcoming busy reporting season from March to April as directors and listed companies are prohibited from trading during the one- to two-month period before the announcement of earnings results.

Buybacks took the spotlight last week with significant repurchases in Dan Form, Beijing Enterprises and Dynam Japan. Even more bullish, there were buybacks and purchases by the chairman of L’Occitane International.

Property play Dan Form bought back for the first time since March 2009 with 276,000 shares purchased on Friday at HK$1.17 each. The trade was made on the back of a 52 per cent drop in the share price since April from HK$2.41. Despite the fall in the share price, the counter is still up since October 2011 from HK$0.39. The stock closed at HK$1.18 on Friday.

Piped natural gas distributor Beijing Enterprises resumed buying back at lower than its acquisition prices last year with 597,000 shares purchased on Friday at HK$35.09 each. The trade was made on the back of a 25 per cent drop in the share price since January from HK$46.95. The group previously acquired one million shares in December and 1.5 million shares in September at HK$46.24 each. The stock closed at HK$35.15 on Friday.

Pachinko halls provider and operator Dynam Japan bought back for the first time since listing in August 2012 with 290,000 shares purchased from Monday to Friday at HK$8.99 to HK$10.04 each or an average of HK$9.82 each. The trades, which accounted for 7 per cent of the stock’s trading volume, were made on the back of a 38 per cent drop in the share price since April from HK$15.94. The group’s buyback prices were sharply lower than the initial public offering price of HK$16.00. The stock closed at HK$10.16 on Friday.

At natural cosmetics retailer L’Occitane International there were buybacks and purchases by chairman and chief executive Reinold Geiger, with a combined 4.81 million shares purchased from January 27 to last Thursday at HK$12.61 to HK$14.00 each or an average of HK$12.82 each. The trades accounted for 24 per cent of the stock’s trading volume. L’Occitane bought back for the first time since December 2011 with 2.4 million shares purchased from January 27 to last Thursday at HK$12.83 each. The trades were made on the back of a 46 per cent drop in the share price since May 2015 from HK$23.85. Geiger resumed buying at lower than his acquisition price in November with 2.4 million shares purchased from January 27 to 28 at HK$12.82 each. The trades increased his holdings to 1.031 billion shares or 69.84 per cent. He previously acquired 337,000 shares from November 23 to 26 at HK$15.43 each. The stock closed at HK$14.76 on Friday.

Robert Halili is managing director of Asia Insider

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