Apologies for the editing - HC wont let me organise the following neatly!
So with a lot of volatility around and Ive just read that China may be going back into lockdown this has brought this forward a week or so. I was hoping to access another top 50 and see if any sellers had stopped as I believe some are close.
Please note the following is only drawing some conclusions based on what is available online and should not be taken as advice and could be incorrect.
@Austin98 and I got a top 50 late last week and we have been doing so research on to the changes and was going to get another top 50 early next week just to see who is still selling as who may have stopped as the last one I had was the start of march so 7 weeks difference however tomorrow looks to be brutal so posting this in advance so people can make sense of the SP decline
Firstly I had previously got myself confused and the broker data was showing Citigroup as the net seller for quite some time I assumed that was the top 5 holder but they are infact “Citicorp” and of no relation and have actually added to their holding.
1st March Top 50 Recap .
At the start of March the top 50 showed CS Third Nominees as the main seller disposing of 3.3mil shares, on top of the 4.5mil they had disposed since the CR in December. They also disposed of 5mil shares at the start of December only to then take up 24mil in the CR. It could be assumed they took up the placement as it was a big discount and expected it to bounce only for it to drop.
Someone suggest CS Third Nominees is Regal Funds, Regal merged with VGI at the start of the year so there is a possibility that once they merged although it is stated they are still running their own individual funds but once information was shared they decided to begin to exit their positions this year.
21/4 Top 50
Downward pressure on the SP coupled with a drip feed of announcements as generally we are entering the strongest time for new contracts and renewals and then add multiple Macro environments boiling in the background has meant a lot of selling since March. Combine this with the fact that a lot of people who participate in the CR are in the red and looking to cut their losses pre tax time. (on a side note I think we will see some resistance around the 25c mark when we do start to head north as CR participants look to break even)
Biggest Net Sellers in order
CS Third Nominees -13,836,821
- As Noted above this could be to do with Regals Merger or the CR not going the way they planned. Regal are also well known to short so they could be exiting a few positions to reload the warchest in anticipation of a correction as ALC may be to long term for them.
- They have 5mil shares as of 21/4 and some larger orders did go through after that so hopefully it is less.
Sandhurst Trustee (JMFG Consol) -5,340,975
- Previously number 5 on the register now down to 8. As stated above this information may be incorrect but is info available online and is conclusions drawn from that information.
- I believe it is a Small boutique Finance Management group from Melbourne - JMFG (website link)
- As per their April 2021 Newsletter they advised it was their only new stock added and they participated in the raise. This raise was completed at 0.32c. Based on information I have they had circa 24.5mil shares in August so if it is assumed these all came from the placement it was $7.68mil investment in April
- They then took another 4mil shares in the last CR in December for the Silverlink Acquisition, they along with many were just trying to get their average down and as with most expected the SP to appreciate. Moving forward from this it appears CS Third Nominees have been relentlessly selling so by the first week of March we had hit below 17 cents or close to 50% of the entry price for JMFG.
- Based on JMFGs December quarter report Alcidion was 9.2% of their portfolio and was their biggest holding. Their report shows some solid gains in other investments but when your largest holding is down close to 50% and your managing other peoples money it can be assumed they had to begin to lighten their exposure/risk not only from a risk management perspective but from a PR point of view as they don’t want to have to declare it as one of their larger holdings and largest losses.
- So if we work on the assumption that they still like ALC but need to have it simmering in the background rather than on every newsletter and quarterly they would need to have it below 5% of their holdings as their news letter shows their number 5 position being around 5% of their portfolio.
- As of December Alcidion were 9.2% of their portfolio which was around $8,700,000. Using round figures that means they have around $95mil of Funds under management. Assuming they want to get below 5% their total Value of ALC needs to then be below $4.75mil.
- As of 21/4 their position was $4.90mil so based on the selling last week they could be well and truly below that threshold and hopefully plan to hold their remaining shares.
- I personally think that they along with many see the long term potential for ALC and will still hold exposure not only for the benefit but to claw back losses.
BNP Paribas Noms (DRP) – 5,215,125
- This holder added 9 mil in the CR taking told holding to 15mil but has sold around 5mil, again above this could be the fact that they needed to lighen due to the drop from the CR.
- Have been a long term holder and with the shift in SP of late again I think the core holding will be held as it was prior to the CR
Its not all doom and gloom – the above I believe shows why we have been smashed of late but at least we can try and draw reasonable conclusions as to the reasons behind it. I personally think that the selling will dry up very quickly and it has loose hands out prior to what should be a good run on for contracts
Net buyers
UBS Nominees +3,637,008
- UBS Nominees are the biggest buyer. UBS came onto the register in February straight up with 9mil. There was a few block trades around then so this could have been them. They sold some late feb and then since the 1/3 they have added another 3.6. Broker data shows UBS responsible for a lot of the trades – since start of Feb they have been responsible for 14% of all trades with 1600 buys and 1800 sells so they are trying to push it down on low volume and then buy back up to build a position.
JP Morgan +3,518,478
- This is who Aust Super have their holding with but they also have other holdings under the JP Morgan umbrella, could be Aust super but may not be. They have 110mil so if it is them they will need to notify market soon, last time they accumulated on market they used Macquarie Insto to do the brokering and then did a block trade to avoid people knowing they were buying on market so I think it could just be other holdings under JP Morgan.
Few others with a new holder with 2.2 mil and a new holder with 1.9mil.
Although small it is good to see that No 3 holder Raymond Blight added 200k to his 96,028,781!
So with a lot going on in the world and things changing not by the day but by the hour I think its important to look on why the SP has been declining and then draw a reasonable conclusion that it someone who isnt interested in the fundamentals and its to do with their entry price being too high and needing to reduce exposure. This may be an opportunity many did not expect to get one that may not come again.
The fundamentals can be for another post another day but anyone who has done research on ALC knows the potential for the products and the perfect timing with so much money being spent on the NHS. It’s a great team, great products and a really bright future, the last 6-12 months have been a rough ride but I feel like things are beginning to turn.
(20min delay)
