Value Partners recently trimmed their stake in HK-listed TK Group Holdings (TK Group). According to a filing made to the Hong Kong Stock Exchange on March 24th, 2017, the firm sold 696,000 shares on the exchange at an average price of HKD 2.517 per share on March 21st (total consideration was ~US$225,500). Following the sale, their stake in TK Group decreased from 8.03% to 7.95% of the company’s shares outstanding.
TK Group is a manufacturer of moulds and plastic components. It is currently a portfolio holding of mine. In early January, I wrote that “[TK] has a big revenue opportunity in the smart and digital devices segments. It sells to a relatively diverse base of end customers with little concentration risk (largest customer is ~9% of sales). The company currently trades at a >10% forward earnings yield and offers a 5% current dividend yield. It also has a net cash balance sheet.” The share price has moved up ~14% since that post – pretty much in line with the market. The thesis remains intact, but I hope to write a more detailed update on the company at some point.
Value Partners is one of Asia’s largest listed, independent asset managers with ~US$14.4bn under management. The firm was founded in 1993 by Cheah Cheng Hye, with backing from the Yeh family. Their investment strategies cover absolute return long-biased, fixed income, multi asset, alternative, relative return and thematic for both institutional and individual clients in Asia Pacific, Europe and the United States. They also offer exchange-traded funds under the Value ETF brand. For more on Cheah Cheng Hye, see my recent post here.