Citi: BLOKS Controlling Shareholder Trims Stake, Short-Term Investor Sentiment Expected to Face Pressure

Stock News10-23

Citi has issued a research report stating that the controlling shareholder of BLOKS (00325) has reduced its stake by approximately 1.56%, and short-term investor sentiment is expected to be negatively affected. The bank maintains its "Buy" rating and target price of HK$82.

The controlling shareholder, Chairman of the Board, Executive Director, and Chief Executive Officer Zhu Weisong sold approximately 3.849 million shares at HK$65.28 per share, equivalent to about 1.56% of the company's equity. The price represents a discount of approximately 6% to the closing price on October 21, raising over HK$250 million in cash.

Citi noted that the proceeds are intended to meet the controlling shareholder's own funding needs and financial arrangements, and are unrelated to BLOKS's business. Following the reduction, Zhu Weisong's shareholding decreased from 53.59% to 52.03%. Short-term investor sentiment is expected to be negatively impacted, as the market is concerned about the controlling shareholder's funding needs and draws parallels to the situation of Haidilao (06862).

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