What Type Of Shareholders Make Up Time Watch Investments Limited's (HKG:2033) Share Registry?

The big shareholder groups in Time Watch Investments Limited (HKG:2033) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. I quite like to see at least a little bit of insider ownership. As Charlie Munger said 'Show me the incentive and I will show you the outcome.

Time Watch Investments is a smaller company with a market capitalization of HK$1.5b, so it may still be flying under the radar of many institutional investors. In the chart below, we can see that institutions are not really that prevalent on the share registry. Let's take a closer look to see what the different types of shareholders can tell us about Time Watch Investments.

See our latest analysis for Time Watch Investments

What Does The Lack Of Institutional Ownership Tell Us About Time Watch Investments?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. Alternatively, there might be something about the company that has kept institutional investors away. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Time Watch Investments, for yourself, below.

Time Watch Investments is not owned by hedge funds. With a 70% stake, CEO Koon Ming Tung is the largest shareholder. This essentially means that they have significant control over the outcome or future of the company, which is why insider ownership is usually looked upon favourably by prospective buyers. With 9.0% and 5.0% of the shares outstanding respectively, Orchid Asia Group Management, Ltd. and David Webb are the second and third largest shareholders.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Time Watch Investments

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own the majority of Time Watch Investments Limited. This means they can collectively make decisions for the company. That means they own HK$1.2b worth of shares in the HK$1.5b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public holds a 14% stake in Time Watch Investments. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Equity Ownership

With a stake of 9.0%, private equity firms could influence the Time Watch Investments board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Time Watch Investments is showing 2 warning signs in our investment analysis , and 1 of those is concerning...

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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

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