BSH: Share Prices

August wasn’t only an exciting month in Birmingham – for shareholders of the holding company in Hong Kong it’s been interesting too, with shares rocketing up by 50% in the last three days of last week. Are HK investors excited by potential promotion?

Hong Kong Stock Exchange

The share price for Birmingham Sports Holdings (BSH, 2309:HK) has bounced around quite a bit in the last month or two, slumping to a low of HK$0.13 a share at one point. However, the end of last week showed some marked improvement.

BSH Share Price - August
(from Bloomberg)

As you can see from the graph I have obtained from the Bloomberg website, the price started to rise on August 29, and looks like it has peaked on Friday.

The reason why this has happened is obvious when looking at the amounts of shares traded in recent days

Screen Shot 2017-09-03 at 08.14.56

On Friday alone, nearly 170million shares changed hands. While there are over 6Bn shares available in BSH, only around 2Bn of those are in public hands – meaning almost 10% of that public float were traded in one day.

Does this mean BSH investors are excited about deadline day as we are?

From speaking to brokers I know in HK, I would say no.

While the deadline day deals were exciting for us as Blues fans, the idea of promotion is still a long way off. With 41 games left to play in the Championship it is still much too early to call who will go up and who won’t, and as such it’s too soon to buy shares in the hope of promotion.

There are other indicators too.

One of the biggest indicators for me is that the shares were predominately bought in blocks rather than as “retail”.

What this means is that the trades done were for large quantities of shares by investors who were moving large amounts of money, rather than smaller quantities bought by general members of the public playing the market.

This graph from AAStocks shows a breakdown of the trades that were made on Friday.

BSH Shares - Block Trading Analysis Sep 1
From AAStocks

As the graph shows, only 4% of shares traded were “retail” blocks. The majority of shares traded were in “blocks” or “ultra-blocks” which indicate professional investors and speculators.

Friday was a day for some investors to sell for profit – hence there being more trades that were “bearish” than “bullish”. I am no stockbroker but this says to me that some big investors had speculated on a price increase and were selling at the top of the market – rather than holding on until promotion.

So why did prices go up?

This is the hardest question to answer, and if I’m truthful the answer is I don’t know.

However, if I was to guess, my guess would be that it would have something to do with the impending Cambodia deal which was delayed on Wednesday.

It could be the new investor who owns GRED building up a stockholding prior to the deal going through – or it could be speculators looking for a quick profit ahead of positive news of the deal.

So when are investors likely to hear more “positive news”?

There are two bits of information due this month. Firstly, the twice-delayed details of the Cambodia deal are due to be released before September 30.

Secondly, and much more importantly, BSH are required to produce their annual results for the 12 month period ending June 30 2017 by September 30. Those results will show how much money the company made (or lost) in the last financial year and will also give an indication of where Blues are at financially.

Does this matter to BCFC fans?

Realistically, the rise and fall of share prices hasn’t any impact on BCFC’s day to day operations.

The only thing that would matter is if a shareholder has built up a reportable shareholding (more than 5%) – although they would not be forced to take the Owners and Directors test until they passed through the 10% threshold.

As only 3% of all shares were traded on Friday, this seems unlikely at the moment.

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