The buying rose for the second straight week with 43 companies that recorded 299 purchases worth HK$473 million based on filings on the Hong Kong stock exchange from November 13 to 17. The number of firms and trades were up from the previous week’s 39 companies and 259 purchases.
However, the buy value was down from the previous week’s acquisitions worth HK$673 million. Sales, on the other hand, rebounded sharply with 20 firms that recorded 73 disposals worth HK$243 million. The figures were up from the previous week’s three companies, 10 disposals and HK$7 million.
Meanwhile, the buy back activity rose after trading flat for two straight weeks with 22 companies that posted 106 repurchases worth HK$1.162 billion based on filings from November 10 to 16. The number of firms and trades were up from the previous 5-day totals of 17 companies and 76 trades. The value, however, was sharply down from the previous week’s turnover of HK$1.52 billion.
The spotlight was on buy-backs last week with several significant repurchases. China XLX Fertiliser and Melco International resumed buying back at higher prices, while Orange Sky Golden Harvest Entertainment recorded rare buy-backs following the sharp fall in its share price.
China XLX Fertiliser bought back 150,000 shares on November 16 at HK$2.70 each. It previously acquired 2.63 million shares from August 16 to September 22 at HK$2.01 to HK$2.45 each or an average of HK$2.11 each.
Investors should note that chief financial officer Yan Yun Hua sold 620,000 shares from January 9 to 12 at an average of HK$2.49 each. The trades reduced her holdings to 276.765 million shares or 27.68 per cent of the issued capital. She previously sold 181,000 shares from November 18 to December 5, 2016 at HK$2.50 each and 468,000 shares from August 11 to September 8, 2016 at HK$2.33 each.
The company started its buy-back programme in August after the stock fell from HK$5.09 in June 2015. The buy-backs since August were made after the company announced a 129 per cent gain in first half profit to 186.6 million yuan (US$28.1 million). The stock closed at HK$2.60 on Friday.
Gaming firm and property investor Melco International Development bought back 2.96 million shares from November 15 to 16 at HK$21.95 to HK$22.70 each or an average of HK$22.36 each. It previously acquired 1.16 million shares from September 13 to 15 at HK$18.28 to HK$18.74 each or an average of HK$18.55 each.
Aside from the buy-backs since September, the company acquired 16.3 million shares from May 5 to 15 at an average of HK$17.26 each. Before the buy-backs this year, the company acquired three million shares in December 2016 at HK$10.93 each and 15.8 million shares from October to December 2014 at HK$21.00 to HK$16.62 each or an average of HK$18.88 each.
Investors should note that Southeastern Asset Management sold 136 million Melco shares from April 11 to October 4 at HK$14.93 to HK$22.95 each, which reduced its holdings by 60 per cent to 91.709 million shares or 5.98 per cent of the issued capital.
The repurchases since October 2014 are Melco’s first buy-backs based on filings on the exchange since 1992. The stock closed at HK$22.85 on Friday.
Film distributor Orange Sky Golden Harvest Entertainment repurchased 17.2 million shares from November 7 to 16 at HK$0.54 to HK$0.66 each or an average of HK$0.60 each. It previously acquired 62.4 million shares from November 1997 to May 2012 at HK$0.17 to HK$4.00 each or an average of HK$0.43 each. Also positive this quarter was chairman Wu Ke Bo who bought 22.2 million shares from October 4 to 25 at HK$0.51 each. The trades increased his holdings to 1.973 billion shares or 68.76 per cent of the issued capital. He previously acquired 33.2 million shares in July 2015 at an average of HK$0.48 each and 5.24 million shares from January to September 2012 at an average of HK$0.38 cents each. Before his trades since 2012, the chairman acquired 18.3 million shares from June to December 2011 at an average of HK$0.30 each.
The recent buy-backs were made after the stock fell by as much as 31 per cent from HK$0.71 on August 24. The counter closed at HK$0.69 on Friday.
Robert Halili is managing director of Asia Insider