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Geely Automobile chairman leads huge stock buying among directors in Hong Kong

Chairman Li Shu Fu’s trades, which accounted for 44 per cent of the stock’s trading volume, increased his holdings to 44.45 per cent of issued capital

PUBLISHED : Sunday, 18 December, 2016, 4:24pm
UPDATED : Monday, 16 January, 2017, 10:28am

Buying rose for the second straight week while the selling among directors rebounded based on filings on the Hong Kong stock exchange from December 12 to 16. A total of 41 companies recorded 281 purchases worth HK$2.228 billion versus 12 firms with 54 disposals worth HK$111 million.

The number of companies on the buying side was unchanged but the number of trades and value were up from the previous week’s 268 purchases worth HK$443 million. On the selling side, the number of firms was consistent with the previous week’s 13 companies while the number of trades and value were up from the previous week’s 49 disposals worth HK$56 million.

Aside from directors, buyback activity rose for the second straight week with 35 companies that posted 152 repurchases worth HK$2.082 billion based on filings from Monday to Thursday. The number of firms and trades were up from the previous week’s five-day totals of 26 companies and 140 repurchases. The value, on the other hand, was not far off the previous week’s turnover of HK$2.558 billion.

The heavy purchases were surprising as the chairman [of Geely] resumed buying after the stock rose by as much as 143 per cent from his acquisition price in January

Directors acquired a whopping HK$2.228 billion worth of shares last week. The huge buy value was mainly due to purchases by the chairman of Geely Automobile worth HK$1.358 billion. The heavy purchases were surprising as the chairman resumed buying after the stock rose by as much as 143 per cent from his acquisition price in January. Another stock that recorded insider buys following a gain in the share price was Sunac China Holdings with its chairman picking up shares after the stock rose by 30 per cent. The purchases in Geely Automobile and Sunac China were few and far between, however, as several directors recorded buys last week following the sharp fall in their companies’ share prices. Among the stocks that recorded insider price support are C.banner International, Colour Life Services Group, JNBY Design Limited and Telecom Digital Holdings.

Chairman Li Shu Fu resumed buying shares of automobile manufacturer Geely Automobile Holdings after the stock rose by as much as 143 per cent from his acquisition price in January with 165.5 million shares purchased from December 6 to 9 at HK$7.85 to HK$8.48 each, or an average of HK$8.21 each. The trades, which accounted for 44 per cent of the stock’s trading volume, increased his holdings by 4.4 per cent to 3.948 billion shares or 44.45 per cent of the issued capital. He previously acquired 8.8 million shares on January 7 at HK$3.49 each. Prior to his trades this year, the chairman acquired 6.065 million shares in July 2015 at an average of HK$3.59 each, and 17.075 million shares from November to December 2014 at HK$3.58 to HK$2.49 each, or an average of HK$2.98 each. Li joined the group in 2005. Also positive this quarter is vice chairman Daniel Li Dong Hui with one million shares purchased on October 27 at HK$8.36 each. The trade increased his holdings by 11 per cent to 10 million shares or 0.11 per cent of the issued capital. He previously acquired 2 million shares on August 23 at HK$5.79 each. The purchases by Li since August are his first on-market trades since his appointment in July. The stock closed at HK$7.26 on Friday.

Chairman Sun Hong Bin recorded his first on-market trades in real estate developer Sunac China Holdings since August 2015 with 27.92 million shares purchased from December 7 to 13 at HK$5.97 to HK$6.73 each, or an average of HK$6.35 each. The trades, which accounted for 20 per cent of the stock’s trading volume, increased his holdings to 2.081 billion shares or 53.97 per cent of the issued capital. The purchases were after the stock rose by as much as 30 per cent from HK$5.16 in October. The counter is also up since September 2015 from HK$4.02. He previously acquired 3.65 million shares in August 2015 at HK$4.23 each and 31.5 million shares from July to November 2013 at HK$4.84 to HK$5.32 each, or an average of HK$5.02 each. The stock closed at HK$6.82 on Friday.

Chairman Chen Yi Xi recorded his first on-market trade in women’s formal and casual footwear designer and manufacturer C.banner International since the stock was listed in September 2011 with 129,000 shares purchased on December 12 at HK$1.99 each. The trade increased his holdings to 750 million shares or 36.11 per cent of the issued capital. The acquisition was made on the back of the 45 per cent drop in the share price since January from HK$3.62. The chairman’s purchase price was lower than the IPO price of HK$3.24. Investors should note that there were buybacks by the company last month with 2 million shares purchased from November 8 to 11 at an average of HK$1.99 each. The group previously acquired 3 million shares from October 20 to 24 at an average of HK$2.12 each. Prior to the buybacks this year, the company acquired 14.9 million shares in July 2015 at HK$2.63 to HK$2.96 each or an average of HK$2.80 each. The corporate shareholder sentiment is not entirely positive this year as non-executive director Wu Guang Ze sold 8.6 million shares from May 25 to 27 at an average of HK$3.01 each, which lowered his stake by 6 per cent to 139.4 million shares or 6.7 per cent. Those are his first on-market trades since his appointment in June 2012. The stock closed at HK$1.90 on Friday.

CEO Tang Xue Bin recorded his first on-market trades in real estate management firm and engineering services provider Colour Life Services Group since July 2015 with 282,000 shares purchased from December 8 to 9 at HK$5.27 each. The trades increased his holdings to 722.019 million shares or 72.19 per cent of the issued capital. The purchases were made on the back of the 19 per cent drop in the share price since August from HK$6.50. He previously acquired 700,000 shares in July 2015 at HK$7.50 to HK$5.87 each or an average of HK$6.80 each. The purchases by the CEO since July 2015 are his first on-market trades since the stock was listed in June 2014. The CEO’s purchase prices were higher than the IPO price of HK$4.60. Tang was appointed to the Board in October 2012. The stock closed at HK$5.10 on Friday.

Chairman & CEO Wu Jian recorded the first corporate shareholder trades in designer brand textile products designer and distributor JNBY Design Limited since the stock was listed in October with 2.47 million shares purchased from December 8 to 12 at an average of HK$6.25 each. The trades, which accounted for 74 per cent of the stock’s trading volume, increased his holdings to 315.474 million shares or 60.81 per cent of the issued capital. The purchases were made on the back of the 14 per cent drop in the share price since November from HK$7.25. The chairman’s purchase price was lower than the IPO price of HK$7.73. The stock closed at HK$6.34 on Friday.

Executive Director Cheung King Shan recorded the first on-market trade by a director in mobile phones services provider and distributor Telecom Digital Holdings since the stock was listed (by way of placing) in May 2014 with 127,000 shares purchased on December 12 at HK$3.64 each. The trade increased his holdings to 240.127 million shares or 59.62 per cent of the issued capital. The acquisition was made on the back of the 23 per cent drop in the share price since November from HK$4.73. Despite the fall in the share price, the counter is still up since November 2014 from HK$1.18. The director’s purchase price was higher than the listing placing price of HK$1.00. The stock closed at HK$3.54 on Friday.

Robert Halili is managing director of Asia Insider

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