Directors step back on purchases but sales remain low

Buying in Bank of East Asia follows price drop, while profits are taken at Changshouhua Food

PUBLISHED : Monday, 08 July, 2013, 12:00am
UPDATED : Monday, 08 July, 2013, 4:47am

Directors eased up on the purchases of shares in their own companies, and selling remained low for a third straight week, filings to the stock exchange show for last week.

However, buyers still far outnumbered sellers, with 46 companies reporting 208 purchases worth HK$540 million by directors, while six companies advised of 17 director sales worth HK$101 million. The previous week's data showed that 59 companies reported 276 purchases worth HK$594 million.

On the selling side, the number of companies and trades were down from the previous week's eight companies and 30 disposals, but the sell value was sharply up from the previous week's HK$53 million.

Heavy price support in property stocks spilled over to other sectors during the week, with acquisitions in Bank of East Asia, West China Cement and TCL Multimedia Technology. On the flip side, the chairman of Changshouhua Food took profits on the shares he acquired last year, following a sharp gain in the share price since March.

Chairman David Li Kwok-po, non-executive director Peter Lee and Guoco Group moved in to support the share price of blue chip Bank of East Asia after the stock fell from HK$32.25 in March to below HK$29 last month.

Li recorded his first trades since October last year, with 150,000 shares purchased from June 26 to 28 at an average of HK$27.49 each. The trades boosted his stake to 66.955 million shares or 2.96 per cent of the issued capital. He previously bought 316,000 shares in October at an average of HK$28.96 each, and 1.29 million shares in August last year at an average of HK$28.40 each.

Lee recorded his first trade in the bank's shares since his appointment in May, with 350,000 shares purchased on June 18 at HK$28.23 each, which increased his holdings by 24 per cent to 1.779 million shares or 0.08 per cent.

Guoco made its first purchase of BEA shares since October 2011, with a filing on June 26 of 740,000 shares at HK$27.41 each. This boosted its stake to 339.766 million shares or 15.02 per cent.

The stock closed at HK$28.05 on Friday.

Chairman Zhang Jimin made his first trade in cement producer West China Cement since August last year, with 850,000 shares purchased on July 2 at HK$1.16 each. This increased his holdings to 1.7568 billion shares, or 38.64 per cent.

The acquisition was made on the back of a 31 per cent drop in the share price since January from HK$1.68. He bought 7.17 million shares in August last year at an average of HK$1.20 each.

Zhang's purchases since July 2011 are his first on-market trades since the stock was listed in August 2010. The stock closed at HK$1.14 on Friday.

Chairman Thomas Li made his first trades in electrical appliance manufacturer TCL Multimedia Technology since December 2011, with two million shares purchased on July 2 and 3 at an average of HK$4.44 each. The trades increased his holdings to 41.684 million shares or 3.13 per cent.

The acquisitions followed a 38 per cent drop in the share price from HK$7.15 since May.

The stock closed at HK$4.44 on Friday.

At Changshouhua Food, chief executive Wang Mingxing recorded his first sale in the edible corn oil products producer since the stock was listed in December 2009. He offloaded 9.4 million shares on June 28 at HK$5.60 each. He also sold 502,000 shares on July 2 through off-market trade at an undisclosed price, which lowered his stake to 269.837 million shares or 51.28 per cent.

The disposals were made at a profit based on the 9.9 million shares he acquired from May to September last year at an average of HK$3.77 each. The stock closed at HK$6.25 on Friday.

Robert Halili is the managing director of Asia Insider.