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INSIDE INSIGHTS

Wilmar, Riverstone and Neo chairs increase stakes

FOR the five local trading sessions that spanned Nov 6 to 12, the Straits Times Index (STI) rallied 4.8 per cent, with the Nikkei 225 Index, Hang Seng Index and S&P/ASX 200 Index averaging a 3.2 per cent gain.

This has brought the STI's decline in total return for the 2020 year to Nov 12 to 12.5 per cent.

Over the five sessions, the iEdge S-Reit Leaders Index declined 0.2 per cent, bringing its decline in total return for the 2020 year to Nov 12 to 4.8 per cent.

Share buybacks

There were 13 primary-listed stocks conducting share buybacks over the five sessions with a total consideration of S$6.3 million.

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This was a significant drop from the preceding week's S$96.0 million led by Wilmar International.

Yangzijiang Shipbuilding (Holdings), Sembcorp Industries, and Global Investments led the buyback consideration tally.

Yangzijiang Shipbuilding (Holdings) acquired 5 million shares at an average price of 94.41 cents per share, taking the total amount of shares bought back on the current mandate to 36,249,200 or 0.93 per cent of the issued shares excluding treasury shares as of the date of the share buyback resolution.

Director and substantial shareholder transactions

The five trading sessions saw fewer than 60 changes in director interests and substantial shareholdings, that were filed for close to 30 primary-listed stocks.

This included 18 company director acquisitions, with no disposals filed, and substantial shareholders filing 10 acquisitions and five disposals.

Wilmar International

Between Nov 6 and 12, Wilmar chairman and chief executive officer Kuok Khoon Hong increased his total interest in the listed company from 12.67 per cent to 12.76 per cent.

The acquisition of 5.7 million shares were booked through HPRY Holdings Ltd, Longhlin Asia Ltd and Hong Lee Holdings (Pte) Ltd, in which Mr Kuok maintains deemed interests.

The average price paid for the acquisitions was S$4.32, with an overall consideration of S$24.6 million.

This followed his acquisition of 2 million Wilmar shares at S$4.28 per share on Nov 4.

Mr Kuok is overall in charge of the management of the group with particular focus on new business developments.

With extensive experience in the industry, he has been involved in the grains, edible oils and oilseeds businesses since 1973.

Neo Group

On Nov 10, Neo Group founder, chairman and CEO Neo Kah Kiat acquired one million shares of the Catalist-listed stock for a consideration of S$470,000.

This increased his total interest in the homegrown integrated food solutions provider from 81.59 per cent to 82.26 per cent.

The acquisition also followed Mr Neo's acquisitions of 2.85 million shares at 42.0 cents per share on Aug 14, 332,000 shares at 38.9 cents per share between July 29 and 30, and 2,653,300 shares at 42.0 cents per share on July 24.

The spouse of Mr Neo, executive director Sally Liew Oi Peng, also increased her deemed interest in Neo Group with the Nov 10 acquisition to 82.26 per cent.

On Nov 9, Neo Group announced a profit before tax of S$20.1 million and a net profit of S$18.0 million for its H1FY21 (ended Sept 30), representing increases of 679.0 per cent and 685.8 per cent from S$2.6 million and S$2.3 million in H1FY20 respectively.

Backed by higher other income, the strong bottom-line growth was attributed to revenue growth from the group's core catering and manufacturing businesses, as well as an overall reduction in operating expenses.

Mr Neo is an industry veteran with over two decades of leadership experience in catering and food and beverage management.

He has led and grown the listed company into Singapore's largest catering provider and the top events caterer, and also continues to helm and steer the group's future strategic direction and expansion to become an integrated food and catering solutions provider.

Moving forward, the group noted its intentions to focus on growing the market share of its catering business by building upon its strong market recognition and branding, while strengthening its recurring income streams through pursuing institutional catering.

AEM Holdings

Back on Nov 4 , the Employees Provident Fund Board of Malaysia increased its deemed interest in AEM Holdings above the substantial shareholder threshold from 4.92 per cent to 5.07 per cent.

Bought for a consideration of S$1,381,105, the average price of the acquired shares was S$3.49.

In a business update on Nov 3, AEM reported revenue of S$161.8 million for its Q3FY20 (ended Sept 30), which was up 93.0 per cent year-on-year.

Management also raised its revenue guidance for FY20 to be between S$500 million and S$520 million, based on the sales order visibility and business outlook.

FY20 Capex is currently projected to be S$5 million, and management has signalled continued focus and more effort in research and development (R&D), with R&D expenditure in Q4FY20 expected to be S$2 million in support of new projects for future years.

AEM has received state job related grants and with the business growth, the group has hired more staff to enhance its core engineering capabilities.

The company added that following the implementation of the various programmes by the government to retain and promote the hiring of workers, AEM Holdings has stepped forward to support these initiatives in hiring trainees in various disciplines.

Riverstone Holdings

Between Nov 10 and 12, Riverstone Holdings executive chairman and chief executive officer Wong Teek Son acquired 170,000 shares of the listed company for a consideration of S$262,600.

At an average price of S$1.54 per share, this increased his total interest in Riverstone Holdings from 51.10 per cent to 51.12 per cent.

Mr Wong is the founder of Riverstone and was appointed to the board as executive chairman on Aug 3, 2005. His executive responsibilities include developing business strategies and overseeing the group's operations.

Riverstone Holdings' 1:1 bonus issue had its ex-date on Nov 9, resulting in a measured share price change from S$3.70 at the close on Nov 6 to an open of S$1.93 on Nov 9.

A corporate presentation/business update on Nov 10 detailed that for its 9MFY20 (ended Sept 30), revenue had grown to RM449.4 million (S$147 million), compared to RM 146.3 million for 9MFY19.

This brought its 9MFY20 net profit to RM 316.2, a 222 per cent increase year-on-year.

The company also maintained its plan to increase capacity by 1.5 billion pieces of gloves every year, its resilient balance sheet and net cash position, and continued ability to generate positive operating cash flow.

Furthermore, Riverstone Holdings highlighted a feature which distinguishes it from its competitors.

It has two main sources of revenue, namely, it makes its own brand hi-tech cleanroom gloves that are sold directly to end-users, and in addition, it also produces healthcare gloves that attract consistent demand that is resilient to changing market conditions.

The company also expects that average selling prices of both healthcare and cleanroom gloves will continue trending upwards due to strong demand.

UOB-Kay Hian Holdings

Between Nov 6 and 11, UOB-Kay Hian Holdings (UOBKH) chairman and managing director Wee Ee-chao acquired 27,000 shares of the listed company for a consideration of S$36,450, at an average price of S$1.35 per share.

This increased his total interest in UOBKH from 30.74 per cent to 30.75 per cent.

Mr Wee's total interest in UOBKH has gradually increased from 29.49 per cent at the end of 2019, and increased from 27.98 per cent at the end of 2018.

GuocoLand

Between Nov 5 and 9, GuocoLand Assets Pte Ltd acquired 55,000 shares of GuocoLand for a consideration of S$80,725 at an average price of S$1.47 per share.

Preceding acquisitions saw GuocoLand Assets Pte Ltd acquire 83,000 shares at S$1.46 per share between Oct 29 and Nov 4 and 115,000 shares at S$1.56 per share between Oct 15 and 22.

The acquisitions have brought GuocoLand non-independent non-executive director Quek Leng Chan's total interest in the listed company to 71.96 per cent.

Mr Quek is also the chairman and chief executive officer of Hong Leong Company (Malaysia) Berhad and has extensive business experience in various business sectors, including financial services, manufacturing and real estate.

Roxy-Pacific Holdings

Between Nov 4 and 9, Roxy-Pacific Holdings independent director Winston Tan Tien Hin acquired 74,500 shares of the listed company for a consideration of S$25,453, at 34.16 cents per share.

This brought his total interest in the established property and hospitality group from 0.86 per cent to 0.87 per cent.

The share purchase followed his acquisition of 100,000 shares at 34.38 cents per share between Oct 30 and Nov 3.

The independent director has gradually increased his total interest in the company from 0.71 per cent on March 29.

Mr Tan is also executive chairman of Serrano and non-executive director of Plastoform Holdings.

Lum Chang Holdings

Between Nov 5 and 11, Beverian Holdings Pte Ltd acquired 744,600 shares of Lum Chang Holdings (LCH) for a consideration of S$260,582, at 35 cents per share.

LCH managing director David Lum Kok Seng maintains interests of more than 50 per cent in the share capital of Beverian.

The acquisitions increased Mr Lum's total interest in LCH from 21.67 per cent to 21.86 per cent, and this followed the acquisition of 73,000 shares, at the same price on Oct 30.

  • The writer is the market strategist at Singapore Exchange (SGX). To read SGX's market research reports, visit sgx.com/research.

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