The Insider
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Hong Kong director and buy-back activity slows after two week surge

PUBLISHED : Sunday, 17 September, 2017, 4:16pm
UPDATED : Sunday, 17 September, 2017, 10:53pm

The director and buy-back activity slowed after surging for two straight weeks based on filings on the Hong Kong stock exchange from September 4 to 8, with 62 companies that recorded 276 purchases worth HK$262 million (US$33.5 million) versus 23 firms with 101 disposals worth HK$378 million.

The number of firms on the buying and selling side were not far-off from the previous week’s 61 and 25 companies, respectively. The number of trades and value, however, were down from the previous week’s 302 purchases and HK$333 million on the buying side and 125 disposals and HK$963 million on the selling side. On the buy-backs side, a total of 25 companies posted 116 repurchases worth HK$1.259 billion, which were down from the previous week’s 28 firms, 132 trades and HK$1.466 billion.

There were more bullish signs in mainland property play Country Garden Holdings with buy-backs and purchases by an executive director. Meanwhile, there were first-time buys in Luye Pharma Group and Bocom International following the falls in their share prices.

There were buy-backs and purchases by vice-chairman Yang Hui Yan in Country Garden Holdings with a combined 52.46 million shares bought from August 30 to September 13 at HK$9.88 to HK$12.00 each or an average of HK$10.85 each. The group bought back 40.8 million shares from August 30 to September 13 at an average of HK$10.89 each.

The company 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 HK$4.05 to HK$6.98 each or an average of HK$4.39 each. Before the buy-backs this year, the group acquired 1.08 billion shares from January to December 2016 at HK$2.85 to HK$4.48 each or an average of HK$3.75 each. The repurchases since January 2016 are the company’s first buy-backs since listing in April 2007.

Vice chairman Yang, on the other hand, bought 11.686 million shares from September 1 to 4 at HK$10.70 to HK$10.90 each or an average of HK$10.73 each, which increased her holdings to 12.286 billion shares or 57.57 per cent of the issued capital. She previously acquired 8 million shares from June 15 to 16 at an average of HK$8.88 each, 20 million shares from May 8 to 10 at an average of HK$7.45 each and 10 million shares from January 19 to 20 at an average of HK$4.41 each.

Before her trades this year, Yang acquired 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, 6 million shares in March 2014 at an average of HK$3.11 each and 87.5 million shares from June to December 2013 at HK$3.63 to HK$5.06 each or an average of HK$4.32 each. Before her purchases since 2013, the vice-chairman acquired 546,000 shares in May 2009 at HK$3.69 each and 2 million shares in October 2008 at HK$1.78 each. The stock closed at HK$13.56 on Friday.

Significant Points

  • Buy-backs and purchases by vice-chairman Yang Hui Yan from August 30 to September 13 accounted for 7 per cent of the stock’s trading volume
  • The purchases were made after the company announced on August 22 a 39.2 per cent gain in first-half profit to 7.50 billion yuan (US$1.1 billion)
  • The group resumed buying back after the stock rose by as much as 72 per cent from its acquisition price in April
  • Yang resumed buying this month after the stock rose by as much as 149 per cent from her acquisition prices earlier this year
  • There were purchases by vice-president Liang Guo Kun, executive director Yang Zi Ying and president Mo Bin from May to July at HK$7.59 to HK$9.99 each

Pharmaceutical products developer and producer Luye Pharma Group repurchased 21.63 million shares from September 4 to 14 at HK$3.98 to HK$4.37 each or an average of HK$4.19 each. The buy-backs were made after the company announced on August 28 an 8.3 per cent drop in first half profit to 387.9 million yuan. The stock closed at HK$4.29 on Friday.

Significant Points

  • Luye Pharma bought back for the first time since listing in July 2014
  • The buy-backs were made after the stock fell by as much as 64 per cent from HK$11.20 in October 2014
  • The group recorded buys on 7 out of the 9 trading days from September 4 to 14
  • The buy-backs accounted for 14 per cent of the stock’s trading volume
  • The group’s buy-back prices were lower than the IPO price of HK$5.92

Chairman and CEO Tan Yueheng acquired an initial one million shares of financial services provider Bocom International Holdings from September 6 to 8 at an average of HK$2.40 each. The shares bought represented 0.04 per cent of the issued capital. The group announced its first-half results on August 22 with profit down by 20.8 per cent to HK$110.565 million. The stock closed at HK$2.45 on Friday.

Significant Points

  • Chairman and CEO Tan recorded the first trades by a director of Bocom since the stock was listed on May 18
  • The chairman’s purchases accounted for 15 per cent of the stock’s trading volume
  • The purchases were made on the back of the 12 per cent drop in the share price since May from HK$2.72
  • The chairman’s purchase price was below the IPO price of HK$2.68

Robert Halili is managing director of Asia Insider

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