What you need to know about the investor mix of Dynamic Holdings Limited (HKG: 29)


A look at the shareholders of Dynamic Holdings Limited (HKG: 29) can tell us which group is more powerful. Institutions often own shares in larger companies, and we would expect insiders to own a noticeable percentage of smaller ones. I like to see at least a little insider ownership. As Charlie Munger said, “Show me the incentive and I’ll show you the result.

With a market capitalization of HK $ 3.3 billion, Dynamic Holdings is a small cap stock, so it may not be well known to many institutional investors. Our analysis of company ownership, below, shows that institutions are not entered in the share register. Let’s dig deeper into each type of owner to learn more about Dynamic Holdings.

See our latest analysis for Dynamic Holdings

SEHK: 29 Breakdown of ownership June 6, 2021

What does the lack of institutional ownership tell us about Dynamic Holdings?

We don’t tend to see institutional investors owning stocks of very risky, lightly traded, or very small companies. While we sometimes see large companies without registered institutions, this is not particularly common.

There can be various reasons why no institution owns shares in a company. Typically, smaller newly listed companies do not attract much attention from fund managers, as it would not be possible for large fund managers to forge a meaningful position in the company. On the other hand, there is always the possibility that professional investors will avoid a company because they think it is not the best place for their money. Dynamic Holdings’ earnings and income (below) may not be convincing to institutional investors – or they simply haven’t looked at the company closely.

profit and revenue growth
SEHK: 29 Profits and Revenue Growth June 6, 2021

We note that the hedge funds do not have a significant investment in Dynamic Holdings. Domingo Chua is currently the largest shareholder, with 39% of the shares outstanding. The second and third shareholders are Lucio Tan and Carmen Tan, with an equal number of shares in their name at 0.9%. Note that the second and third shareholders are also Top Key Executive and Board Member, respectively, which means that the major shareholders of the company are insiders.

A closer look at our ownership data shows that the top 10 shareholders collectively own less than half of the ledger, suggesting a large group of small holders with no majority shareholder.

While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand the expected performance of a stock. We do not see any analyst coverage of the stock at this time, so the company is unlikely to be widely held.

Insider ownership of Dynamic Holdings

The definition of company insiders can be subjective and vary from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management ultimately reports to the board of directors. However, it is not uncommon for managers to be board members, especially if they are founders or CEOs.

Insider ownership is positive when it indicates that executives think like the real owners of the company. However, strong insider ownership can also confer immense power on a small group within the company. This can be negative in certain circumstances.

Our most recent data indicates that insiders own a reasonable proportion of Dynamic Holdings Limited. It has a market cap of just HK $ 3.3 billion, and insiders have shares worth HK $ 1.4 billion in their own name. It’s great to see insiders so invested in the business. It might be worth checking out if these insiders have bought recently.

General public property

The general public has a substantial 57% stake in Dynamic Holdings, which suggests that it is quite a popular stock. This size of property gives mainstream investors some collective power. They can and probably do influence decisions about executive compensation, dividend policies and proposed business acquisitions.

Next steps:

I find it very interesting to see who exactly owns a company. But to really get an overview, we have to take other information into account as well. Consider, for example, the ever-present specter of investment risk. We have identified 2 warning signs with Dynamic Holdings (at least 1 that cannot be ignored), and understanding them should be part of your investment process.

If you would rather consult with another company – one with potentially superior finances – then don’t miss this free list of interesting companies, supported by solid financial data.

NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.

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This Simply Wall St article is general in nature. It does not constitute a recommendation to buy or sell shares and does not take into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative material. Simply Wall St has no position in any of the stocks mentioned.
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