STOCK MARKET
The Insider
by

Buying by directors rises for first time in five weeks

Rare buybacks in Tsui Wah, Fosun International and Man Wah

PUBLISHED : Sunday, 28 February, 2016, 2:46pm
UPDATED : Monday, 16 January, 2017, 10:28am

The buying rose for the first time in five weeks while the selling among directors was low for the seventh straight week based on filings to the stock exchange in the fourth week of February.

Seventeen companies recorded 90 purchases worth HK$119 million versus five firms with 15 disposals worth HK$41 million. The buy figures were up from the previous week’s 16 firms, 69 purchases and HK$24 million.

On the selling side, the number of companies was consistent with the previous week’s four firms while the number of trades was sharply up from the previous week’s six disposals. The sell value was sharply down from the previous week’s disposals worth HK$235 million.

Meanwhile, buyback activity was flat with 16 companies posting 82 repurchases worth HK$154 million. The number of firms was unchanged while the number of trades was up from the previous week’s 61 transactions. The huge jump in the number of repurchases, however, did not translate into a higher trade value as the buybacks last week were sharply down from the previous week’s turnover of HK$404 million.

There were only a few significant transactions last week with rare buybacks in Tsui Wah, Fosun International and Man Wah. Meanwhile, the chairman of KWG Property resumed buying following the sharp rebound in the share price.

Food catering services provider Tsui Wah bought back for the first time since listing in November 2012 with 2.64 million shares purchased from February 23 to 26 at an average of HK$1.40 each. The trades, which accounted for 28 per cent of the stock’s trading volume, were made on the back of a 49 per cent drop in the share price since April last year from HK$2.73. The counter is also sharply down since November 2013 from HK$5.25. The group’s buyback prices were sharply lower than the initial public offering price of HK$2.27. The stock closed at HK$1.53 on Friday.

Healthcare products manufacturer and property developer Fosun International bought back for the first time since February 2008 with 1.4 million shares purchased on February 12 and a further 1.46 million shares on February 25 at an average of HK$9.72 each. The trades were made on the back of a 36 per cent drop in the share price since November from HK$15.18. The group previously acquired 15.9 million shares from January to February 2008 at an average of HK$5.31 each. Also positive this quarter were purchases by chairman Guo Guangchang and vice-president Xu Xiaoliang. Guo acquired 9.5 million shares from January 11 to 21 at an average of HK$10.32 each, which increased his holdings to 6.154 billion shares or 71.48 per cent of the issued capital. He previously acquired 25.5 million shares in July at an average of HK$14.59 each and 53.6 million shares from April to July 2011 at an average of HK$6.09 each. Xu purchased 1.4 million shares from January 15 to 28 at of HK$10.11 each, which boosted his stake by 14 per cent to 11.590 million shares or 0.13 per cent. The stock closed at HK$10.32 on Friday.

Furniture manufacturer Man Wah bought back for the first time since March last year with 5.5 million shares purchased from February 22 to 25 at an average of HK$9.02 each. The trades, which accounted for 29 per cent of the stock’s trading volume, were made on the back of a 37 per cent rebound in the share price since July 2015 from HK$6.57. Despite the rebound in the share price, the counter is still down since April last year from HK$9.73. The group previously acquired 40 million shares from February to March last year at an average of HK$6.80 each, 6.54 million shares in January 2014 at an average of HK$14.01 each and 89 million shares from November 2011 to June 2013 at an average of HK$4.26 each. The stock closed at HK$9.15 on Friday.

Chairman Kong Jianmin recorded his first on-market trades in residential property developer KWG Property since September with 2.6 million shares purchased from February 22 to 24 at HK$5.12 to HK$4.67 each or an average of HK$4.89 each. The trades increased his holdings to 1.824 billion shares or 60.88 per cent of the issued capital. The acquisitions were made after the stock rebounded by as much as 16 per cent from HK$4.40 on January 21. Kong previously acquired 700,000 shares in September at HK$4.74 each, 661,000 shares in June 2013 at HK$3.91 each and 29.9 million shares from September to November 2011 at an average of HK$2.87 each. The stock closed at HK$4.64 on Friday.

Robert Halili is managing director of Asia Insider