I've been keeping a close eye on what substantial shareholders have been doing recently. Especially following the market crash.
Substantial shareholders are those that hold 5% or more of a company's shares. These tend to be large investors, asset managers, and investment funds. These shareholders are obliged to update the market when they make any changes to their holdings.
As a result, I feel investors should look to use these notices to their advantage. After all, they show where the so-called smart money is going.
Two notices that have caught my eye this week are summarised below:
Baby Bunting Group Ltd (ASX: BBN)
Copia Investment Partners has been buying more of this baby products retailer's shares this month. According to a change of interests of substantial holder notice, Copia has picked up a total of ~1.4 million Baby Bunting shares through on market trades in April. The investment company paid an average of $2.47 per share or a total consideration of over $3.4 million. This lifted its stake in the company up to 7.14%.
It appears as though Copia investment Partners believes Baby Bunting's shares have been oversold during the market crash. At present they are changing hands at $2.66, which is still 34% lower than the 52-week high of $4.03 they reached in February.
Nuchev Ltd (ASX: NUC)
A change of interests of substantial holder notice reveals that Mithaq Capital has been topping up its holding in this small cap infant formula company. According to the notice, last week Mithaq Capital picked up ~$1.12 million worth of Nuchev shares through a series of on market trades. This lifted its holding in the company to a lofty 19.67%.
Mithaq Capital is a Saudi Arabian conglomerate with headquarters in Riyadh. It has been invested in the company since its IPO and has been growing its stake consistently over the last few months. It was particularly busy during March when Nuchev's shares were sold off in the market crash and dropped to as low as $1.37. They are now back above $3.00.
