The Insider
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Kasen International and Central China Securities Co complete share buybacks while mixed messages from executives at AV Concept

Eight companies that posted 25 repurchases worth HK$61 million based on filings from February 20 to 23, a holiday-shortened trading week

PUBLISHED : Sunday, 25 February, 2018, 2:30pm
UPDATED : Sunday, 25 February, 2018, 2:30pm

The buying fell while the selling among directors rebounded sharply based on filings on the exchange during the holiday-shortened week of February 20 to 23. A total of 15 companies recorded 48 purchases worth HK$109 million (US$13.93 million) versus six companies with 17 disposals worth HK$7.3 million.

Meanwhile, the buyback activity fell for the first time in the past three weeks with eight companies that posted 25 repurchases worth HK$61 million based on filings from February 20 to 22.

Several firms recorded rare repurchases this month with buybacks in Kasen International, Central China Securities, Cybernaut International and AV Concept Holdings. The buybacks in AV Concepts were not totally bullish as there were sales by two directors of the company this month, one of which was by founder and chairman Dr. So Yuk-kwan.

Mainland furniture and leather products manufacturer Kasen International repurchased 16.1 million shares from February 9 to 22 at an average of HK$1.40 each. The Group previously acquired 12.2 million shares from December 2009 to July 2010 at an average of HK$1.89 each, as well as 817,000 shares in November 2008 at an average of 73 HK cents each and nearly 24 million shares in August 2006 at an average of HK$1.05 each. The stock closed at HK$1.49 on Friday.

Significant Points

The recent buybacks are the group’s first repurchases since 2010

The group recorded buys on seven out of the eight trading days during that period

The recent buybacks accounted for 58 per cent of the stock’s trading volume

The recent buybacks were made after the stock rebounded by as much as 27 per cent from HK$1.14 in November 2017

The recent buybacks were made after the group issued a profit warning on February 5 which stated that the consolidated net loss for the year ended December 31, 2017 is expected to record a substantial increase to 175 million yuan (US$27.64 million)

Brokerage and investment firm Central China Securities Co repurchased 6.2 million shares from February 12 to 15 at an average of HK$3.14 each. The stock closed at HK$3.26 on Friday.

Significant Points

The group bought back for the first time since listing in 2014

The group recorded buys on every day during that four-day period

The buybacks accounted for 55 per cent of the stock’s trading volume

The buybacks were made after the stock fell by as much as 35 per cent from HK$4.68 in November 2016. The counter is also down since April 2015 from HK$8.58

The group’s buyback prices were higher than the IPO price of HK$2.51

Industrial machinery products manufacturer and distributor Cybernaut International acquired nearly 62 million shares from February 9 to 21 ator an average of 26 HK cents each. The Group previously acquired 38.2 million shares from September to October 2014 at an average of 50 HK cents each. Also positive this quarter is chairman Zhu Min with 21.4 million shares purchased from January 2 to 19 at an average of 29 HK cents each. The trades increased his holdings to 23.03 per cent of the issued capital. The purchases by the chairman since September 2017 are his first on-market trades since the stock was listed in July 2010. The counter closed at 29 HK cents on Friday.

Significant Points

The recent buybacks are the group’s first repurchases since 2014

The group recorded buys on every day during that seven-day period

The recent buybacks accounted for 68 per cent of the stock’s trading volume

The recent buybacks were made after the stock fell by 50 per cent from the company’s acquisition prices in 2014

There were conflicting trades in electronics components distributor AV Concept Holdings with buybacks by the company versus sales by CEO So Yuk-kwan and independent non-executive director Lui Ming-wah. The group repurchased 5.1 million shares on February 22 at 64 HK cents each. On the sellers’ side, So sold 2 million shares on February 23 at 63 HK cents each, which reduced his holdings to 336.281 million shares or 36.23 per cent of the issued capital. He previously acquired 54.6 million shares from October 2014 to December 2017 at an average of 53 HK cents each. On the other hand, Lui sold 2 million shares on February 12 at 64 HK cents each, which lowered his stake by 49 per cent to 0.28 per cent. The counter closed at 64 HK cents on Friday.

Significant Points

The recent buyback is the group’s first repurchase since 2013

The recent buyback was made was made after the stock rebounded by 25 per cent from 51 HK cents on February 6. Despite the sharp rebound in the share price, the counter is still down from its level of 73 HK cents.

Robert Halili is managing director of Asia Insider

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