The Insider

Sun Hung Kai directors snap up own-company shares amid bullish Hong Kong property market sentiment

Insider buying by directors remains high for a third straight week, with auto parts maker Minth also reporting strong executive purchases

PUBLISHED : Monday, 11 June, 2018, 9:10am
UPDATED : Monday, 11 June, 2018, 9:10am

Hong Kong directors’ buying of shares in their own companies was high for a third week in the June 4 to June 8 period, with executives at property firms Sun Hung Kai Properties and Future Land Development prominent amid bullish sentiment over the city’s real estate market.

A total of 44 companies recorded 265 purchases by directors worth HK$526 million, a similar number to the previous week’s 45 companies with 255 purchases but with a sharp increase in the value from the previous week’s HK$347 million.

On the selling side, 18 companies reported 73 disposals worth HK$177 million, compared to the previous week’s 19 companies with 64 disposals. The sell value was sharply down from the previous week’s disposals worth HK$504 million.

Meanwhile, buy-back by companies activity fell for a second straight week, with 18 companies that posted 81 repurchases worth HK$1.03 billion, based on filings to the stock exchange from June 1 to June 7. The figures were sharply down from the previous five-day totals of 25 companies, 112 trades and HK$1.68 billion in value.

Strong sales of new flats across Hong Kong, plus the announcement of the redevelopment of Hutchison House – a major office tower in Hong Kong’s Central district – as well as shopping centre operator Link Reit’s planned buy-backs contributed to a bullish atmosphere in the property sector.

Two members of the Kwok Family acquired more shares in their Sun Hung Kai Properties company at higher prices.

Executive director Adam Kwok Kai-fai picked up 9,000 shares on May 31 at HK$124.50 each, increasing his deemed holdings to 640.860 million shares, or 22.12 per cent of the issued capital. He had previously acquired 114,000 shares on April 26 at HK$121.36 each.

Adam Kwok, 34, is the nephew of chairman and managing director Raymond Kwok Ping-luen, who bought 856,000 shares from April 17 to April 25 at HK$123.70 to HK$121.08 each, or an average of HK$122.75 each. The trades boosted his stake to 515.138 million shares, or 17.78 per cent.

Raymond Kwok had previously acquired 12.1 million shares from January to December 2016 at HK$80.60 to HK$104.20 each, or an average of HK$91.54 each, 52.8 million shares from January 2003 to December 2015 at HK$35.00 to HK$140.80 each and 4.57 million shares from February 1993 to November 1996 at HK$27.20 to HK$93.75 each, or an average of HK$46.07 each. The stock closed at HK$126.90 on Friday.

Elsewhere in the property sector, the chairman of Future Land Development, Wang Zhenhua, recorded his first on-market trades in the company since November 2017 with 1.66 million shares bought from May 30 to June 1 at HK$6.18 to HK$6.40 each, or an average of HK$6.21 each.

The trades increased his holdings to 4.173 billion shares, or 70.53 per cent of the issued capital. The purchases were made after the stock rose by as much as 58 per cent from his acquisition prices last year, based on the 66.55 million shares that he acquired in November 2017 at HK$4.04 to HK$4.96 each, or an average of HK$4.54 each.

Those earlier purchases were made after the stock rose from previous acquisition prices based on the 36.5 million shares that he acquired from December 2013 to September 2015 at 71 HK cents to HK$1.70 each, or an average of 91 HK cents each.

The purchases since December 2013 are his first on-market trades since the stock was listed in November 2012. The last purchase price was sharply higher than the IPO price of HK$1.79.

The company also bought back 7.62 million shares from April 3 to April 6 at HK$6.55 each. It had previously acquired 10 million of its own shares from September to October 2015 at HK$0.98 to HK$1.24 each, or an average of HK$1.09 each. The stock closed at HK$7.20 on Friday.

Meanwhile, another significant trade was recorded in auto parts maker Minth Group, as founder and chairman Chin Jong-hwa recorded his first on-market trade since April 2017 with one million shares bought on June 1 at HK$35.22 each.

The trade increased his holdings to 450.072 million shares, or 39.31 per cent of the issued capital and came on the back of a 28 per cent drop in the share price since January from HK$48.90.

It was made at a sharply higher price than his previous acquisition, based on the 2 million shares that he acquired in April 2017 at HK$27.70 each and 27 million shares bought from January 2008 to December 2016 at HK$2.13 to HK$26.50 each, or an average of HK$8.89 each.

Separately, Minth independent non-executive director Vivian Zheng Yu bought 460,000 shares from March 21 to April 6 at HK$40.80 to HK$34.90 each, or an average of HK$37.31 each. The trades increased her holdings to 1.210 million shares or 0.11 per cent.

She had previously acquired 200,000 shares in April 2017 at HK$27.96 each and an initial 420,000 shares (net trades) from June 2013 to December 2016 at HK$10.82 to HK$24.53 each, or an average of HK$17.49 each. The stock closed at HK$38.00 on Friday.

Robert Halili is managing director of Asia Insider