After surging for two consecutive weeks, directors' buying of shares in their own companies fell in the second week of the month, with 43 companies reporting 149 purchases worth HK$175 million, based on filings made to the stock exchange.
The activity was sharply down from the previous week's 53 companies that reported 282 purchases worth HK$290 million. This coincided with a 4.18 per cent rebound in the Hang Seng Index last week to 20,629.78 points.
Surprisingly, the surge in the market did not result in profit taking, as insider sales fell for a second week with eight firms reporting 20 disposals worth HK$7.4 million, down from nine companies that reported 35 trades worth HK$146.9 million.
Buy-back activity was also down, with 20 companies disclosing 70 share repurchases worth HK$45.9 million, against 23 companies that reported 99 trades worth HK$96.2 million the week before.
Non-executive director Shi Yuzhu of China Minsheng Banking was one of the top buyers, with 5 million shares bought on September 6 at HK$5.76 each. The trade raised his holdings to 349.48 million shares, or 6.05 per cent of the issued capital. The acquisition was made after the stock plunged 22 per cent from HK$7.38 on August 9.
Shi previously acquired 42.7 million shares in September last year at an average of HK$4.77 each. Interestingly, those trades were made after the counter plunged from HK$6.66 in August and from HK$7.63 in April last year. The stock rebounded sharply after those acquisitions to HK$6.82 in October.
Shi seems to have retained his impeccable timing, since the stock has rebounded again, closing higher from his last purchase price at HK$6.43 on Friday.
Chairman Kang Dian recorded the first on-market trade by a director of New China Life Insurance since the stock was listed in December last year, buying 30,000 shares on September 11 at HK$21.40 each. The trade was on the back of a 40 per cent drop in the share price since May from HK$36.15.
The stock closed at HK$22.95 on Friday.
Chairman Ji Wei recorded his first on-market trades since September last year in Wasion, which makes electronic energy, water, and heat meters, with 3 million shares bought from September 5 to 7 at an average of HK$2.71 each. The trades lifted his direct holdings to 485.89 million shares, or 52.29 per cent.
The acquisitions were made after the stock fell 19 per cent from HK$3.33 on August 3. Nevertheless, the counter is still up since October last year from HK$1.99.
Ji previously acquired 16.1 million shares from August 2009 to September last year at an average of HK$3.46 each; and 22.26 million shares from February to December 2008 at an average of HK$1.96 each. Investors should note that the stock rose an average of 43 per cent six months after these acquisitions.
The stock closed at HK$2.97 on Friday.
Environmental protection and new energy firm China Ground Source Energy bought back shares for the first time since 1992, with 9.58 million shares acquired from September 12 to 14 at an average of 37.5 HK cents each.
The trades were made on the back of a 23 per cent drop in the share price since April from 49 HK cents.
The stock last traded at 40 HK cents on Friday.
Electronics components distributor AV Concept resumed buying back shares after the stock fell 39 per cent from 79 HK cents in February, with 894,000 shares bought from September 10 to 13 at an average of 47.8 HK cents each.
The group previously acquired 164,000 shares on January 9 at 61 HK cents each.
Chief executive So Chi-on also bought 400,000 shares from June 21 to July 13 at an average of 52 HK cents each, which boosted his stake to 1.4 million shares or 0.23 per cent. He previously acquired 680,000 shares from July 2007 to October 2009 at 39 to 64 HK cents each.
Chairman So Yuk-kwan bought 614,000 shares on June 21 at 57 HK cents each, which increased his holdings to 270.39 million shares or 44.75 per cent. He previously acquired 3.6 million shares from December 2010 to February last year at an average of HK$1.79 each.
The counter closed at 51 HK cents on Friday.
Robert Halili is managing director of Asia Insider