Thank you Observer2 for your sharing. At this juncture, investors are rightfully wary of the selling, which is not alarming in my opinion. Still, it has indeed made people turn cautious. I too would not be too happy to cheong in.
The 4Q result will be out soon and we will know what is the shape of the business but in the meantime, I think we can try to see the selling in better perspective: Lien Chien-Liang is a small holder. He had 602,000 shares and sold 552,000 which brought him about S$110,000. This is peanuts.... and it's not as though he is a big fish selling because of a negative outlook for the company
Lai Pin Yong is different in one aspect. He is the No.2 largest shareholder of Action Asia, after the parent company which owns more than 50%.
Lai Pin Yong sold about 1.15 m shares, equivalent to less than 5% of his entire holding. He collected S$230,000 and he sold just a small % of his holding which now stands at 24 million shares.
Lai Pin Yong is 67 years old and a non-executive director, and he could be getting some cash for his spending / enjoyment as he is retired.
Hi, Abb & Erelation. You may recall that in September 2010 (expiry of share moratorium), Hong Rong Zhi, who held 150 million (10.42%) of China Gaoxian, unloaded millions of his shares at below IPO price of 26 cts; and causing Gaoxian share price to tumble down from 23 cts to 17 cts. Gaoxian’s share price later managed to stage a strong recovery with a doubling in price by Jan 2011.
I respect and give full credit to insiders who divest their shares after the share price has made a sharp run up to fully valued or overvalued level as I think they belong to the “smart money group” of people. However, the same cannot be said of insiders who sold out their shares at very depressed and undervalued price. They may be having personal financial or other problems but their action are seen as not much different from the “dumb investors” who throw out the bathtub water with the baby in it.
Some wise guy once said that there may be any number of reasons directors sell shares - buy house, pay for children's education, buy car, take profit, be kiasu, etc.
There is only 1 reason directors buy shares - they expect to make money from it.
I will prefer to buy Qingmei instead of Action. The latest flat result have causes the weaker and short term player to exit the market.
Today weakness is a good buying opportunity with FY11 PE of 3-4x with dividend yield of 7% New capacity already completed and management is focus in ramping up the volume..... fund manager brought at 34 cents level.
