Trading Analysis - 7th Sept 2018

Alfacomp

7 September 2018


 

Update at bottom of page

Following this morning's RNS describing industrial action earlier in the week the share price experience a rapid downward shock, followed by an equally rapid recovery once it was realised that this posed no significant threat to the business.

In fact a number of commentators on the LSE board suggested this was a positive move as it could lead to greater employee involvement in the business and subject to a successful negotiated agreement could establish Bushveld as an employer much better rooted in the local community than the previous company owner, Evraz, with it's multi-billionaire owner living in London.


The detailed price movements will be analysed more carefully below but at this point in time it would appear that the excess of Buys over Sells has not only grown from the nett position of c. +1.4M at the end of Thursday, by 2pm may have now grown yet 1.2M larger still.

The detail of the 10:45 - 11:15 period is shown below




What appears most unexpected about this is that the nett trade position went strongly positive before it went negative. People were apparently BUYING on the news, not selling. Why then the share price fall ?

This unexpected point of view stems from the assumption that the trades between 10:45:53 and 10:47:46 are indeed all Buys. How can we know this ? Well one of the posters on here has claimed 4 out of 6 of them as his/her Buys. For this to be correct and the SP fall in any way justifiable we must assume that there is a Sell of over 500K from before 10:45:43 that is yet to be reported.

We shall see - but even if such a sell did appear there still remains a very strong excess of Buying today following this attack on the share price.

Those looking in from the outside may be impressed to see just how highly regarded this company is by its shareholders, who are not billionaires or oligarchs but ordinary hard working people, just like those employed at Vametco. We welcome them joining us as stakeholders in this great business and building the foundations of an Energy Storage industry in South Africa.


End Day Position


The LSE poster 'CharlieR' has claimed that there are a total of 2 million shares to come:-


I see no reason for such a claim, especially made as it was, after the large sells after 4pm (400K, 2x250K, 500K, 100K) were already published. In fact the 1.5 Million of sells after 4pm very nicely balances the Market Makers books - suggesting to me instead the possibility that the Market Makers might actually be picking these up, as they need, from the pre-sale of a warrants block.

This would not of course have made an impact on the 1.4M of excess Buys vs Sells in the previous 2 days, and indeed the balance attained on Friday might be purely coincidental. This always assumes that we have been indulged with all the information on Friday's trading at this point - should further delayed trades become evident then it would be interesting to revisit the discussion of nett trade balance attained on the 5,6 and 7th of Sept.

 

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