Trading Places: Sierra Rutile has some big new shareholders after IPO

West Africa-focused minerals sands producer Sierra Rutile has new substantial shareholders since its July IPO
Money starts to flow back into healthcare sector including pharmaceuticals distributor Sigma Healthcare
First Sentier sells out its substantial holdings in uranium player Boss Energy and oil and gas producer Karoon Energy

Trading Places is Stockhead’s semi-regular, pretty damn fascinating recap of the latest red flag buying and selling of ASX small and mid-cap shares. It is here that the rubber really hits the road for fund managers, stakeholders, distant (and not-so-distant) relatives and other famous or infamous investors.

Specifically, Trading Places tracks substantial shareholder movements – namely when a trade in a company’s stock crosses or falls below the 5% threshold.

Substantial shareholders are usually directors, individual investors, institutional investors… or their distant (and not-so-distant) relatives, which they will refer to as listed related bodies corporate or something similar. You can see in detail these listed bodies on the company’s ASX announcement.

Shareholders are required by basic human decency (and the law) to publicly declare via the exchange when their personal stake goes below or above 5%, and from there, every movement in their holdings while owning above 5%.

The becoming and ceasing to be substantial shareholders are the ones we think are worth noting, where a trade takes an investor over the 5% threshold or has them drop back below.

Here’s the form to get you started, if reading this makes you twitchy.

Fortnight overview

The ASX has experienced a positive fortnight in what has been a tumultuous year with economic uncertainty and interest rate rises. The S&P/ASX 200 (ASX:XJO) has risen modestly 0.39% in the past five days with information technology, materials and utilities leading the rally.

For the first time since June the S&P is back above the 7000 mark, showing resilience to rising economic uncertainty and the US recession, (widely defined as a shrinking economy of falling GDP two quarters in a row).

Coinciding with the slightly stronger markets there has also been some large buys and sells on the ASX recently.

Buyers

Code	Company	Market Cap	Date of change	Holder	Stake
SRX	Sierra Rutile	$182.4M	27/7/2022	Blackrock Group and subsidiaries named	6.61%
SRX	Sierra Rutile	$182.4M	27/7/2022	Vanguard Group and its controlled entities	5.34%
SRX	Sierra Rutile	$182.4M	2/8/2022	State Street Corporation and subsidiaries named	6.33%
SIG	Sigma Healthcare	$667.34M	2/8/2022	Superannuation and Investments HoldCo and related bodies corporate listed	5%
SIG	Sigma Healthcare	$667.34M	2/8/2022	Comet Asia Holdings II Pte. Ltd and related entities	5%
HLS	Healius	$2.33B	1/8/2022	State Street Corporation and subsidiaries named	5.06%
RHC	Ramsay Health Care	$16.38B	4/8/2022	Blackrock Group and subsidiaries named	5.01%
SRX	Sierra Rutile	$182.4M	27/7/2022	Blackrock Group and subsidiaries named	6.61%
SRX	Sierra Rutile	$182.4M	27/7/2022	Vanguard Group and its controlled entities	5.34%

Sierra Rutile (ASX:SRX) has new substantial shareholders since listing on the ASX on July 27. SRX demerged from Iluka Resources (ASX:ILU) to become a standalone West Africa-focused minerals sands producer and developer.

As Stockhead’s Josh Chiat explained, natural rutile is a high quality titanium feedstock, used in markets like pigment, aerospace and welding with Sierra thinking it could be the best commodity to ride out the storm of a potential recession.

While prices for LME-traded base metals like copper, zinc and aluminium have fallen of late, mineral sands pricing has continued to increase. However, the share price in Sierra has fallen since its listing from above 40 cents to below 30.

Funds are also starting to flow back into the healthcare sector, including one of Australia’s largest full line pharmacy wholesalers Sigma Healthcare (ASX:SIG). The S&P/ASX 200 healthcare index (ASX:XHJ) has risen more than 5% in the past month.

Sigma has seen its share price rise ~26% to 63 cents in the year to date with Morningstar pointing it out as still representing good value.

Sellers

Code	Company	Market Cap	Date of change	Holder
LNK	Link Administration Holdings	$2.27B	15/7/2022	UBS Group AG and its related bodies corporate
LER	Leaf Resources	$27.60M	20/7/2022	Kenneth Richards
EML	EML Payments	$346.87M	14/7/2022	State Street Corporation and subsidiaries named
OZL	OZ Minerals	$5.76B	15/7/2022	Ausbil Investment Management
WEB	Webjet	$1.91B	19/7/2022	L1 Capital Pty Ltd
EGG	Enero Group	263.75M	22/7/2022	UBS Group AG and its related bodies corporate
MZZ	Matador Mining	$27.19M	20/7/2022	CI Investments Inc as manager of nvestment funds listed
BOE	Boss Energy	$708.68M	22/7/2022	First Sentier Investors Holdings & related bodies corporate
VSL	Vulcan Steel	$1.14B	22/7/2022	Regal Funds Management Pty Ltd and its associates

Building materials supplier CSR (ASX:CSR) has seen Macquarie Group sell out its substantial holdings. Australia’s construction sector has been under pressure in the past 12 months from surging construction costs.

However, while CSR’s share price has fallen more than 24% year to date, it has enjoyed the July rally and is up ~8% to $4.59.

First Sentier has sold out its substantial holdings in uranium player Boss Energy (ASX:BOE) and oil and gas producer Karoon Energy (ASX:KAR).

According to Stockhead’s Reuben Adams there may soon not be enough uranium production to meet demand with Boss one of those companies looking set to benefit from the shortfall. Boss recently announced it was restarting the Honeymoon uranium mine in South Australia after nine years.

The BOE share price has risen 50% to $2.50 since hitting its 2022 low on June 23.