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Enoch Yiu

The Insider Dealing Tribunal has been asked to investigate trading by several directors of plastic products manufacturer Ngai Hing Hong who are alleged to have purchased shares ahead of a bumper results announcement in 1995.

 The Financial Secretary appointed Michael Sze Tsai-ping and Felix Chow Fu-kee as lay members of the tribunal which will be led by Mr Justice Michael Burrell.

 Sources said the case centred on share purchases by several of the company's senior executives on July 21, 1995, after they learned the company would soon report profit for the year to June 30, 1995, had soared.

 The results were not due to be announced until September 1995.

 Ngai Hing Hong's shares rose from $1.27 each on July 11, 1995, to $1.50 on July 21, and accelerated further to $1.93 on July 26, 1995.

 The following September, Ngai Hing Hong announced attributable profit rose 73 per cent to $60.92 million, up from $35.18 million the previous year.

 After the announcement, its shares rose further to a peak of $2.883 per share on October 9, 1995.

 Ngai Hing Hong manufactures and distributes plastic resins and other raw materials for plastic products and has been in business for more than 24 years.

 The company's majority shareholders are chairman Hui Sai-chung and deputy chairman Hui Kwok-kwong.

 Chairman Hui said at the time that the sharp rise in profit was due mainly to an increase in the retail price of plastic raw materials in the year as well as increasing demand for such plastic raw materials.

 The firm's turnover rose 44 per cent to $587.66 million in 1995 from $406.66 million the previous year.

 The Ngai Hing Hong case may be the last insider dealing case to be heard by tribunal chairman Mr Justice Burrell.

 Mr Justice Burrell was appointed to the post for a term of two years as Mr Justice Frank Stock's term ended at the end of 1996.

 High Court Judge Michael Hartmann is likely to replace Mr Justice Burrell as chairman, a source said.

 Mr Justice Burrell has handled several insider dealing cases involving Yanion, Hong Kong Parkview Group, Chevalier (OA) International, Hong Kong Worsted Mills and Emperor (China Concept) Investments.

 A preliminary hearing of the Ngai Hing Hong case will be held today.



Ngai Hing Hong executives face investigation