The Insider

Directors’ trading surge, led by Country Garden, MOBI and China Resources Land

PUBLISHED : Sunday, 03 September, 2017, 11:59am
UPDATED : Sunday, 03 September, 2017, 10:30pm

Directors’ trading activities surged based on filings on the Hong Kong Exchange from August 28 to September 1, with 44 companies that recorded 192 purchases worth HK$132 million versus 14 firms with 60 disposals worth HK$90 million.

The figures were sharply up from the previous week’s 4-day totals of 20 companies, 91 purchases and HK$81 million on the buying side, and 10 firms, 32 disposals and HK$57 million on the selling side. Aside from directors, the buyback activity increased significantly last week with 26 companies that posted 119 repurchases worth HK$982 million based on filings from August 25 to 31.

The most significant trades last week were purchases with buybacks in Country Garden Holdings and MOBI Development and a rare insider purchase in China Resources Land.

Property developer Country Garden Holdings repurchased 16 million shares at an average price of HK$10.22 per share. The group previously acquired 4.44 million shares on April 3 at HK$6.96 each and 156.9 million shares from January 5 to March 31 at an average of HK$4.39 each. Prior to this year, the company acquired 1.08 billion shares from January to December 2016 at an average of HK$3.75 each. The repurchases since January 2016 are the company’s first buybacks since listing in April 2007.

Aside from the company, there were purchases by vice president Liang Guo Kun, vice chairman Yang Hui Yan, executive director Yang Zi Ying and president Mo Bin earlier this year.

Vice president Liang Guo Kun purchased 352,000 shares from June 26 to July 7 at an average price of HK$8.81 each, which increased his holdings by 21 per cent to 2.027 million shares or 0.01 per cent of the issued capital. He previously acquired 425,000 shares in March 2014 at HK$3.09 each, 202,000 shares in November 2013 at HK$5.38 each and 50,000 shares in June 2013 at HK$4.46 each.

Vice chairman Yang Hui Yan, purchased 8 million shares from June 15 to 16 at an average of HK$8.88 each, boosting her stake to 12.274 billion shares or 57.51 per cent. She previously acquired 20 million shares from May 8 to 10 at an average of HK$7.45 each, 10 million shares from January 19 to 20 at an average of HK$4.41 each and 129.9 million shares from January to October 2016 at HK$2.98 to HK$4.30 each or an average of HK$3.52 each.

Executive director Yang Zi Ying purchased 1 million shares on June 6 at HK$9.99 each, which boosted her stake to 6.750 million shares or 0.03 per cent. She previously acquired 3 million shares from May 8 to 12 at an average of HK$7.52 each. Prior to her purchases this year, the director acquired an initial 2.750 million shares in August 2016 at HK$3.78 each.

President Mo Bin acquired 4.32 million shares from May 16 to 22 at HK$7.59 to HK$8.22 each or an average of HK$7.65 each, raising his holdings to 15.030 million shares or 0.07 per cent. He previously acquired 4.6 million shares in May 2016 at an average of HK$2.99 each, 2.9 million shares in April 2015 at an average of HK$3.75 each and an initial 3.000 million shares in March 2014 at HK$3.12 each. The stock closed at HK$10.82 on Friday.

Significant Points

  • The recent buybacks were made after Country Garden stock rose by as much as 49 per cent from its buyback price in April.
  • The buybacks accounted for 14 per cent of the stock’s trading volume
  • The buybacks were made after Country Garden announced on August 22 a 39.2 per cent gain in interim profit to 7.50 billion yuan (US$1.14 billion).

Mobile communications components manufacturer MOBI Development repurchased 245,000 shares from August 28 to 29 at an average of HK$1.15 each. MOBI previously acquired 1.5 million shares from December 2011 to July 2012 at an average price of HK$0.91 each. The stock closed at HK$1.18 on Friday.

Significant Points

  • The company bought back shares for the first time since 2012
  • The buybacks were made on the back of the 25 per cent drop in the share price since the second half of March from HK$1.54
  • The buybacks accounted for 7 per cent of the stock’s trading volume
  • The company bought back despite announcing on August 23 a 85.7 per cent drop in interim profit to 8.335 million yuan
  • The Group’s buyback prices were sharply lower than the IPO price in December 2009 of HK$3.38

China Resources Land’s vice chairman Tang Yong acquired an initial 100,000 shares of the property developer and investor on August 25 at HK$23.10 each. He previously sold his entire holdings of 10,000 shares in May 2014 at HK$15.10 each. That sale was made at a loss based on the initial 10,000 shares that he acquired in June 2013 at HK$19.42 each. The stock closed at HK$24.50 on Friday.

Significant Points

  • Tang shares at 53 per cent higher than his sale price in 2014

Robert Halili is managing director of Asia Insider Limited.