COMMENTARY
The Insider
by

Insiders’ selling surged last week, led by HSBC chairman Tucker’s sale of AIA shares

Mark Edward Tucker, who becomes HSBC’s chairman designate in September, last week sold 15.47 million shares of his former company AIA for HK$832 million. He still owns nearly 14 million AIA shares.

PUBLISHED : Sunday, 14 May, 2017, 4:11pm
UPDATED : Sunday, 14 May, 2017, 10:15pm

Buying rose for the second week, while selling among directors surged based on filings to the Hong Kong Stock Exchange from May 8 to 12.

A total of 34 companies recorded 186 purchases worth HK$315 million while 15 companies reported 127 disposal worth HK$1.147 billion.

Last week’s huge sales value due to new HSBC chairman-designate and former AIA chief executive Mark Edward Tucker, who unloaded 15.47 million AIA shares from April 28 to May 8 worth HK$832 million, or HK$53.79 each. The disposal, accounting for 10 per cent of the stock’s trading volume, cut his stake by 53 per cent to 13.968 million shares, or 0.12 per cent of issued capital. Tucker, who assumes his new HSBC role in September, will likely unload his remaining AIA shares week.

Another stock that may see heavy selling pressure next week is healthcare providers UMP Healthcare Holdings. The Securities & Futures Commission revealed on April 27 that 21 shareholders held a combined 90.09 per cent of UMP’s issued capital, warning prospective investors to exercise extreme caution when dealing in the company’s shares.

UMP insiders have started reducing their interests with two executive directors unloading a combined 47.3 million shares from May 4 to 5, worth HK$192 million at an average of HK$4.07 per share. The bulk of those was by executive director Jiang Tianfan, who sold his entire stake of 46.396 million shares, or 6.3 per cent of issued capital.

There were several rare acquisitions last week following the sharp fall in share prices with buybacks in First Tractor, Town Health International, and insider buys in China ZhengTong Auto Services, First Shanghai Investments, C&D International and Nanjing Sinolife United.

Industrial tractor manufacturer First Tractor resumed buying back at lower than its acquisition prices from September to December 2016 with 2 million shares purchased from May 8 to 11 at an average of HK$4.06 each.

The transactions, accounting for 29 per cent of volume, occurred after the stock price fell 21 per cent February. The group previously acquired 3.98 million shares from September to December 2016 at HK$4.35 each and 2.06 million shares from July to August 2016 at HK$4.10 each. The stock closed at HK$4.02 on Friday.

Town Health bought 72 million of its own shares back from May 9 to 11 at an average price of HK$1.24 each. The trades, which accounted for 83 per cent of trading volume, were made on the back of the 15 per cent drop in the share price since June 2016 from HK$1.46. The counter is also down since February 2015 from HK$3.06. The group previously acquired 632,000 shares from September to November 2011 at HK$0.67 to HK$0.85 each or an average of HK$0.72 each and 9.02 million shares in March 2009 at HK$1.00 each. The stock closed at HK$1.24 on Friday.

ZhengTong’s chairman Wang Muqing recorded his first on-market trades in the automotive distributor since October 2011 with 2 million shares from May 8 to 9 at an average of HK$4.13 each, raising his holdings to 1.374 billion shares, or 62.19 per cent of issued capital. The purchases were made after the 16 per cent drop in share price since March. Despite the fall, the counter is still up since December 2016 from HK$2.21. He previously acquired 11 million shares from September to October 2011 at an average of HK$8.33 each. The stock closed at HK$4.50 on Friday.

First Shanghai’s chairman and managing director Lo Yuen-yat recorded his first on-market trades in the financial services provider since October 2011 with 456,000 shares from May 5 to 9 at an average of HK$1.03 each, accounting for 16 per cent of the stock’s trading volume, and raising his holdings to 181.758 million shares or 12.81 per cent of issued capital. The purchases were made after the 29 per cent drop in the share price since November 2016 from HK$1.45. He previously acquired 1.5 million shares from September to October 2011 at HK$0.585 each. The stock closed at HK$1.04 on Friday.

C&D’s chairman Zhuang Yuekai recorded the first on-market trades by a director in the property investment firm since the stock‘s December 2012 listing, with 712,000 shares from May 4 to 5 at HK$4.33 each, raising his stake to 51.292 million shares, or 11.98 per cent of issued capital. The purchases were made after the 27 per cent drop in the share price since December 2016. The counter is down since June 2015. Zhuang was appointed to the board in February 2015. The stock closed at HK$4.30 on Friday.

Sinolife United’s CEO Zhang Yuan recorded the first on-market trade by a director in the nutritional supplements retailer since its January 2014 IPO, with an initial 132,000 shares purchased on May 4 at HK$1.39 each, representing 0.05 per cent of issued capital. The acquisition was made after the 53 per cent drop in the share price since June 2016 from HK$2.98. The counter is also down since June 2015 from HK$3.97. Zhang’s purchase price was lower than the IPO price of HK$2. She was appointed to the board in June 2011. The stock closed at HK$1.38 on Friday.

Robert Halili is managing director of Asia Insider

business-article-page