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More momentum in buybacks and insider acquisitions
FOR the five sessions ended March 15, the Straits Times Index (STI) gained 1.1 per cent compared to an average 0.8 per cent gain for the benchmarks of Japan, Hong Kong, Australia and the United States. In terms of SGD total returns, the STI has continued to be the best 2018 performer (through to March 15) of the benchmarks, gaining 3.54 per cent compared to their average marginal decline of 0.02 per cent.
Share buyback value for the five sessions encompassing March 9 to15 continued the preceding weeks' momentum with 17 stocks buying back a total consideration of S$65.3 million. Boustead led the buyback consideration tally, with 28.9 million shares purchased for a buyback value of S$22.0 million. CapitaLand bought back S$15.1 million in share value, while OCBC bought back S$10.8 million in share value.
Over the five sessions, 65 SGX primary-listed stocks lodged 150 changes in director interests or substantial shareholders. There were 35 director acquisitions and seven disposals filed, with substantial shareholders filing 20 acquisitions and four disposals. Lum Chang Holdings managing director David Lum Kok Sen continued to build his stake in the construction and property development play, taking his stake in the stock to 20.754 per cent.
Accrelist executive chairman and managing director Terence Tea Yeok Kian also continued to build his stake in the Catalist-listed company, taking his stake to 24.42 per cent.
UOB-Kay Hian Holdings chairman and managing director Wee Ee Chao increased his total stake in the financial services stock from 26.52 per cent to 26.54 per cent.
Yanlord Perennial Investment (Singapore) Pte Ltd (YPIL) continued to acquire shares of United Engineers (UEL). Three filed transactions saw YPIL acquire 500,000 shares of UEL, taking the deemed UEL interest of its executive chairman Zhong Sheng Jian to 33.68 per cent.
Soo Kee Capital Pte Ltd acquired five million shares of Soo Kee Group for a consideration of S$700,000. This took the investment holding company's stake in the Catalist-listed jeweller from 57.2 per cent to 58.1 per cent.
Meanwhile Cortina Holdings substantial shareholder Henry Tay Yun Chwan increased his stake in the luxury watch retail and distribution group. Dr Tay increased his stake in Cortina Holdings from 12.40 per cent to 12.69 per cent with the consideration of the acquisition at S$392,669.
One of the most publicised disposals of the week was that of Boustead Singapore substantial shareholder and former deputy chairman Saiman Ernawan. On March 9, Mr Ernawan disposed of 20.39 million shares for a consideration of S$15.5 million. The following session (March 12) he disposed of his remaining stake in Boustead Singapore with 28.97 million shares sold for a consideration of S$22.0 million. Prior to the two transactions Mr Ernawan maintained a 9.46 per cent stake in the stock. Note that on March 12, Boustead Singapore bought back 26.7 million shares of its aforementioned total of 28.9 million shares over the week.
On March 12, Hengfai Business Development Pte Ltd acquired 3.925 million shares of Singapore eDevelopment for a consideration of S$227,572. Singapore eDevelopment (SeD), executive chairman Chan Heng Fai is a director and the sole shareholder of Hengfai Business Development Pte Ltd. At an average price of S$0.05798 per share, this took the global business veteran's total stake in Singapore eDevelopment to 69.1 per cent. Mr Chan's preceding filed share acquisitions were on Dec 5 (38,000 shares) and Nov 23 (9.01 million shares).
On Feb 27, SeD reported a loss for its FY17 (ended Dec 31) of S$6.39 million, lower than the loss of S$7.15 million in FY16. The following day, SeD announced that its subsidiary, Global BioLife Inc had completed the Zaire Ebola virus research portion for the study of a new anti-viral drug called LB2, which is part of the universal therapeutic drug platform, Linebacker. A key objective of Global BioLife is to provide solutions that have been plaguing the biomedical field for decades.
SeD has four key businesses that include property development and investments primarily in the United States and Western Australia; information technology-related businesses; development, research, testing, manufacturing, licensing and distribution of biomedical products; and investment activities. Last year, Mr Chan noted that the various initiatives executed will allow SeD to broaden its revenue streams and secure earnings in the near to medium term.
Ocean Sky International
Ocean Sky International substantial shareholder Celestine Ang Sher Yin disposed of her 6.92 per cent stake in the stock on March 7. The 22,472,000 shares were sold to Ocean Sky International executive chairman & CEO Edward Ang Boon Cheow for a consideration of S$2,359,560. This took Mr Ang's direct stake in Ocean Sky International to 57.07 per cent.
The Catalist-listed stock is an investment holding company with an interest in civil engineering, construction and related services as well as real estate development, investment and management.
On March 1 the company reported its FY17 (ended 31 Dec) net profit increased 315 per cent yoy to US$3.6 million. The group recorded a revenue increase of US$18.36 million. This was attributed to a full year's revenue recognised from the group's construction and engineering segment following the ATS Acquisition, and higher rental income.
On March 8, UOL Equity Investments Pte Ltd acquired 61,200 shares of United Industrial Corporation (UIC) at an average price of S$3.3116 per share. This took the total stake in UIC held by its chairman, Wee Cho Yaw, to 49.84 per cent.
Mr Wee's preceding transaction was Nov 29 with the acquisition of 27,181 shares at an average price of S$3.3072 per share. Next month, he will retire from his longstanding position on the UOB board at the Bank's AGM.
On Feb 23, UIC reported a FY17 net profit of S$324.9 million, a 17 per cent yoy increase compared to FY16. The group achieved revenue of S$1.3 billion, which was a 25 per cent yoy increase mainly due to higher revenue recognition from trading properties. With its FY17 results, UIC management noted that rising office rental seen in the second half of 2017 is expected to sustain due to growing demand for new office space.
Management added that retail rentals will remain challenging amid competition from new retail space and online operators and stronger demand is expected to return to the residential property. Management also maintained that the hotel industry is likely to improve despite new hotel room supply in the market.
- The writer is the market strategist at Singapore Exchange (SGX). To read SGX's market research reports, visit sgx.com/research.