Retail investors who hold 51% of Kidztech Holdings Limited (HKG:6918) gained 12%, insiders profited as well

Key Insights

• Kidztech Holdings' significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 49% of the business is held by the top 4 shareholders
• Insiders own 49% of Kidztech Holdings

To get a sense of who is truly in control of Kidztech Holdings Limited (HKG:6918), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 51% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Retail investors gained the most after market cap touched HK$1.3b last week, while insiders who own 49% also benefitted.

Let's take a closer look to see what the different types of shareholders can tell us about Kidztech Holdings.

See our latest analysis for Kidztech Holdings

What Does The Lack Of Institutional Ownership Tell Us About Kidztech Holdings?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. 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 Kidztech Holdings, for yourself, below.

Kidztech Holdings is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Huang Yu with 33% of shares outstanding. With 8.9% and 4.1% of the shares outstanding respectively, Xiongbin Wu and Chongjian Chen are the second and third largest shareholders.

A deeper look at our ownership data shows that the top 4 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Kidztech Holdings

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.

It seems insiders own a significant proportion of Kidztech Holdings Limited. It has a market capitalization of just HK$1.3b, and insiders have HK$624m worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 51% stake in Kidztech Holdings, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Kidztech Holdings better, we need to consider many other factors. Take risks for example - Kidztech Holdings has 3 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.