The Insider

Buyback activity surges to HK$866m in last week of June

PUBLISHED : Sunday, 02 July, 2017, 7:32pm
UPDATED : Sunday, 02 July, 2017, 10:00pm

Buyers outnumbered sellers in every trading category last week with 47 companies that recorded 206 director purchases worth HK$217 million versus 15 firms with 71 disposals worth HK$107 million based on filings on the Hong Kong Stock Exchange in the last week of June.

Meanwhile, the buyback activity surged with 28 companies that posted a whopping 173 repurchases worth HK$866 million based on filings from June 23 to 29. The figures were sharply up from the previous 5-day totals of 21 firms, 111 trades and HK$509 million.

The top buyer among directors last week in terms of value was Yang Jiye, chairman of iron ore concentrates producer China Hanking Holdings, with buys worth HK$34.4 million from June 21 to 28 at an average of HK$1.18 each. The trades increased his holdings to 679.473 million shares or 37.13 per cent of the issued capital. He previously acquired 2.9 million shares from April 28 to May 4 at an average of HK$1.27 each and 23 million shares from October to November 2016 at HK$0.974 each. The stock closed at HK$1.20 on Friday.

There are four significant points on Yang’s recent purchases:

The purchases from June 21 to 28 accounted for 68 per cent of the stock’s trading volume

The chairman resumed buying in June after the stock fell by 23 per cent from HK$1.54 in the second half of May

The purchases since April are Yang’s first on-market trades since his appointment to his post in March

Aside from the buys by the chairman this quarter, CFO Zheng Xue Zhi acquired 193,000 shares from May 2 to 5 at an average of HK$1.28 each

Other notable trades were recorded in paper products manufacturer Lee & Man Paper Manufacturing Limited with the company’s two top directors picking up a combined HK$7.03 million worth of shares from June 22 to 26 at an average of HK$7.03 each.

Chairman Raymond Lee Man Chun purchased 2 million shares on June 22 at HK$7.05 each, which increased his holdings to 282.000 million shares or 6.24 per cent of the issued capital. He previously acquired HK$210,000 worth of shares in April 2007.

CEO Lee Man Bun, on the other hand, purchased 930,000 shares on June 26 at HK$6.51 each, which boosted his stake to 308.080 million shares or 6.82 per cent. He previously acquired 200,000 shares in December 2014 at HK$4.16 each and HK$2.76 million shares from September to October 2013 at an average of HK$4.65 each. The stock closed at HK$7.25 on Friday.

There are four significant points on these recent purchases:

Rare acquisitions by these two directors with chairman Lee recording his first purchase since 2007 while CEO Lee recorded his first buy since December 2014

CEO Lee resumed buying at sharply higher than his acquisition prices from September 2013 to December 2014

The purchases by these two high-level directors this month were made after the stock rebounded by 19 per cent from HK$5.90 in March

There were also buybacks by the company this year with 7.96 million shares purchased from May 4 to 8 at HK$6.06 each and 14 million shares from March 16 to April 6 at HK$6.15 each

The group announced in February a 22.8 per cent gain in annual profit to HK$2.862 billion.

Robert Halili is managing director of Asia Insider