TWO former senior employees of UOB Kay Hian Private Limited (UOBKH) were charged on Wednesday for allegedly lying to the Monetary Authority of Singapore (MAS) in relation to reports on a then Catalist aspirant. Lan Kang Ming, 38, and Wee Toon Lee, 34, each face three charges of providing MAS with false information in October 2018 in relation to due diligence reports on an unidentified company applying to list on the Catalist board of the Singapore Exchange. MAS said in a media statement on Wednesday that it was performing an onsite inspection of UOBKH between June and August 2018, to assess the latter's controls, policies and procedures in relation to its role as an issue manager for Initial Public Offering (IPOs). During the examination, Lan and Wee were said to have provided different versions of a due diligence report relating to background checks on a company applying to be listed on the Catalist board of the Singapore Exchange. UOBKH had acted as the issue manager
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Major shareholders in more than 500 A-share companies have sold 37.4 billion yuan of shares since September 1
Daniel Ren in Shanghai
14 October 2014
A quiet selling spree by major shareholders of mainland-listed firms amid the rally before the launch of the through train scheme linking the Hong Kong and Shanghai stock exchanges points to a bearish economic and earnings outlook.
According to Wind Information, a market data provider, major shareholders in 524 A-share companies sold 3.15 billion shares worth 37.4 billion yuan (HK$47.3 billion) between September 1 and October 10.
“As big shareholders rushed to cash out, retail investors better be cautious,” said Dong Jun, a Shanghai-based hedge fund manager. “It’s a sign that fundamentals remain weak despite a recent rally.”
Major shareholders include state-owned parents and founders of listed firms. These entities normally sell their shares on the block trading system at the Shanghai and Shenzhen stock exchanges.
The benchmark Shanghai Composite Index advanced 7.1 per cent between September 1 and October 10, creating a good opportunity for big players to cash out.
A venture capitalist who did not want to be identified said his fund took advantage of the rally to dump shares because he believed a correction was around the corner.
“Fundamentals don’t support a rally,” said the fund manager. “After all, earnings are likely to be lacklustre.”
Shenyin & Wanguo Securities predicted last month that the Shanghai index would fall to as low as 1,950 points in the short term based on fair valuations of the listed firms.
The recent rally was partly spurred by the imminent launch of the stock connect scheme to allow mainland and Hong Kong investors to conduct cross-border trades.
The launch date has yet to be announced, though it was expected to begin this month.
Beijing is determined to ward off financial risks with a tight monetary policy, which is not conducive for a sustained rally, the fund manager said.
An executive with a listed firm that did not dump shares in this round of selling admitted that the overall business environment has been getting worse on the mainland.
“It’s difficult to sustain earnings, let alone chase earnings growth,” he said. “Sales remain flat while labour and rental costs keep growing fast.”
Wind said major shareholders of Dongxu Optoelectronic Technology sold shares worth a combined 1.74 billion yuan last month, the biggest cash-out.
“Some of the major shareholders who appeared to be selling down during the rally might want to buy them back when the stocks fall by 10 or 20 per cent,” said Wu Kan, a fund manager with Dragon Life Insurance.
“The worst-case scenario is the founders totally lost their confidence and exited once and for all.”