Hang Lung (10 HK) Is Inexpensive As Dodge & Cox Sells (A Little)

• Back in January 2024 HLP offered a scrip dividend option, and HLG has taken full advantage, increasing its stake by 4%.

• As HLG adds more HLP, long-term deep value play Dodge & Cox gradually sells HLG. That makes things interesting. And HLG’s P/B is inexpensive.

The Trade:

• HLG remains dirt cheap at 0.23x P/B - albeit illiquid.

• Expect HLG to continue to exercise its rights to HLP scrip and chip away at minorities. It does not need the cash.

• I doubt there is some grand plan afoot - for either HLP or HLG. Dodge & Cox selling HLG does, however, play into the Chan’s court.

• I’d be getting some exposure in HLG.

This insight is labelled bullish, as I’m not bearish.