Directors pull back on share purchases after buying spree

Amid quieter spell, Johnson Electric resumes its buy-back and Esprit bosses jump in after rally

PUBLISHED : Monday, 11 November, 2013, 5:17am
UPDATED : Monday, 11 November, 2013, 6:43am

Buying of their own company shares by directors plunged last week after heavy purchases for four consecutive weeks, with 16 companies reporting 58 acquisitions worth HK$85.9 million.

The figures were sharply down from the previous week's 31 companies with 139 purchases worth HK$145 million.

Selling was flat, with 11 companies reporting 29 disposals worth HK$56.3 million. The figures were not far off the previous week's 11 companies that reported 36 trades worth HK$60.4 million.

Buy-back activity also fell, with seven companies posting 30 transactions worth HK$60.6 million. The figures were down from the previous week's nine companies with 41 purchases valued at HK$87 million.

The bulk of the significant trades last week were acquisitions, with buy-backs in Johnson Electric and insider purchases in Changmao Biochemical Engineering, Merry Garden and Esprit.

Electronic components manufacturer Johnson Electric resumed buying back its shares a day after announcing its interim results. It bought 53,000 shares on Friday at HK$5.80 each after posting a 29 per cent gain in first-half profit to US$110 million. The group had acquired 2.4 million shares from August 16 to 29 at an average of HK$4.93 each.

Also positive about the group's outlook this year is Schroders, with a purchase-related filing on September 10 of 1.9 million shares at HK$5.38 each, which increased its holdings to 215.25 million shares, or 6 per cent of the issued capital.

Johnson Electric closed at HK$5.86 on Friday.

Chairman and chief executive Rui Xinsheng resumed buying shares of organic acids producer Changmao at a higher price, with 68,000 shares on Thursday at HK$1.32 each.

The trade doubled Rui's holdings to 136,000 shares, or 0.07 per cent.

Rui had earlier bought 68,000 shares from August 19 to 21 at an average of HK$1.10 each.

The stock closed at HK$1.34 on Friday.

Executive director Xie Qingmei recorded her first trade in outdoor wooden products manufacturer Merry Garden since the stock was listed in July last year. She bought 1.02 million shares on November 6 at 93 HK cents each.

The trade raised Xie's holdings by 15 per cent to 7.9 million shares, or 0.79 per cent.

The purchase price was lower than the initial public offering price of HK$1.

The counter closed lower from executive director's purchase price at 88 HK cents on Friday.

Chairman and non-executive director Raymond Or Ching-fai and deputy chairman Paul Cheng Ming-fun recorded purchases in global fashion retailer Esprit, with a combined 1.73 million shares from October 30 to November 4 at HK$13.73 to HK$14.28 each, or an average price of HK$13.80.

The acquisitions followed a rebound in the share price since September from HK$11.66.

Or recorded his first trade since his appointment in June last year with an initial one million shares bought on October 30 at HK$13.75 each. The shares bought represented 0.05 per cent of the issued capital.

Cheng bought 725,000 shares from October 30 to November 4 at HK$13.87 each.

The stock closed higher from the directors' purchase prices to HK$14.98 on Friday.

Robert Halili is managing director of Asia Insider