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INSIDE MARKETS: Sharp rise in sales, buy figures take a plunge

BUYING activity fell while sales by directors and substantial shareholders rose last week based on filings on the Singapore Exchange in the first week of December. A total of 50 firms recorded 143 purchases versus 18 companies with 56 disposals. The buy figures were down from the previous week’s 61 firms and 180 acquisitions while the sales were sharply up from 12 companies and 33 disposals.

On the funds side, the buying was flat for the fourth straight week while sales activity rose. A total of 13 asset managers posted 47 acquisitions which were consistent with the previous week’s 13 fund managers and 44 trades. On the sales side, nine institutions recorded 45 disposals which were nearly double the previous week’s five asset managers and 24 sales. The buyback activity among listed firms also fell with only 11 companies that posted 41 repurchases worth $11.3 million last week. The figures were sharply down from the previous week’s 17 firms, 67 trades, and buybacks worth $19.5 million.

There were several significant trades in the local market last week. On the buying side, Aegis Portfolio Managers resumed buying shares of Broadway Industrial Group at a higher price. While Aegis was buying on the way up, T Rowe Price Associates raised its stake in China New Town Development Company to 5.1 per cent after the stock fell by 20 per cent. Tiedemann Global Emerging Markets also bought shares of Lian Beng Group after the counter fell by 8 per cent. There was also price support in UMS Holdings as its CEO recorded more acquisitions at a lower price. On the sales side, a director of Hsu Fu Chi International recorded a huge disposal after the stock rebounded by 13 per cent. The disposals were significant as they were the first trade by a director of the company since listing.

Broadway Industrial Group

Aegis Portfolio Managers resumed buying shares of foam-moulded interior protective packaging products manufacturer Broadway Industrial Group at higher than its purchase prices in March. The fund manager bought 500,000 shares on Dec 5 at an estimated price of $1.12 each, which increased its deemed holdings to 15.5 million shares, or 7.5 per cent, of the issued capital. The group previously acquired eight million shares from March 14 to 28 at 69 cents to 84 cents each. Aegis Portfolio Managers became a substantial shareholder in September 2004 following the purchase of an initial 7.5 million shares, or 5.1 per cent, at 28 cents each. The stock closed at $1.11 on Friday.

China New Town Development Company

T Rowe Price Associates reported the first corporate shareholder trade in mainland new town projects developer China New Town Development Company since the stock was listed on Nov 14. The group reported an initial filing on Dec 3 of 7.1 million shares at 64 cents each, which increased its deemed holdings by 11 per cent to 71.7 million shares, or 5.1 per cent. The initial filing was made after the stock fell by 20 per cent from the trading debut price of 80 cents. The counter closed slightly higher from T Rowe Price’s initial filing price to 67.5 cents on Friday.

Lian Beng Group

Tiedemann Global Emerging Markets resumed buying shares of building construction and civil engineering firm Lian Beng Group after the stock fell by 8 per cent from its purchase price last month.

The group purchased 3.5 million shares on Dec 3 at an estimated price of 67 cents each, which increased its direct holdings by 11 per cent to 36.6 million shares, or 7.4 per cent. The asset manager previously acquired seven million shares on Nov 1 at what was then the stock’s record high price of 72.5 cents each.

Tiedemann reported an initial filing on Oct 4 of 12.4 million shares at 54 cents each, which raised its interest by 90 per cent to 5.3 per cent. Overall, the group’s stake is up by 10.5 million shares, or 40 per cent, since that initial filing in October. The stock has rebounded sharply from Tiedemann’s last purchase price to 76.5 cents on Friday.

UMS Holdings

CEO Andy Luong resumed buying shares of contract equipment manufacturer UMS Holdings at lower than his purchase price in March. Mr Luong acquired 600,000 shares on Nov 29 at 36 cents each, which boosted his direct stake to 104.6 million shares, or 25.5 per cent. He previously acquired 3.6 million shares on March 2 at 45 cents each. The chairman’s trades since March were made on the back of the sharp decline in the share price since mid-July from 75 cents. Prior to the purchases this year, the chairman acquired 600,000 shares in December 2005 at 39 cents each and 972,000 shares in April 2005 at an average of 46.6 cents each. The recent acquisitions were made three weeks after the company announced its 3Q results.

UMS Holdings posted an 84 per cent drop in net profit to $2.048 million for the 3 months to Sept 30, 2007. Earnings for the first nine months fell by 54 per cent to $10.387 million. The company also bought back shares earlier this year with 9.6 million shares purchased from March to August at 44 cents to 58 cents each or an average of 50 cents each. The group previously acquired 7.1 million shares from June to October 2006 at an average of 44 cents each. The counter closed at 37.5 cents on Friday.

Hsu Fu Chi International

Director Hsu Pu recorded the first trade by a director of mainland confectionery firm Hsu Fu Chi International since the stock was listed in December 2006 with 10 million shares sold on Dec 4 at $1.20 each. The sale reduced his direct holdings by 9 per cent to 97.2 million shares or 12.2 per cent. The disposal was made after the stock rebounded by 13 per cent from $1.06 on Nov 28.

Investors should note that UOB Asset Management ceased to be a substantial shareholder in August following the sale of 2.8 million shares at an estimated price of $1.11 each, which lowered its stake to 4.8 per cent. The group previously reported an initial filing in June of 2.1 million shares at $1.20 each, which raised its interest to 5.2 per cent. Hsu Fu Chi International announced its 1Q results in October with net profit up by 64.4 per cent to RMB 41.1 million for the three months to Sept 30, 2007. The stock closed at $1.18 on Friday.

The writer is managing director, Asia Insider Limite

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