OSL Group Limited's (HKG:863) stock price dropped 9.8% last week; individual investors would not be happy

Key Insights

• OSL Group's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 45% of the business is held by the top 25 shareholders
• Insider ownership in OSL Group is 34%

If you want to know who really controls OSL Group Limited (HKG:863), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 55% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders who own 34% came under pressure after market cap dropped to HK$4.5b last week,individual investors took the most losses.

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

View our latest analysis for OSL Group

What Does The Institutional Ownership Tell Us About OSL Group?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in OSL Group. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at OSL Group's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in OSL Group. Shuai Liu is currently the largest shareholder, with 30% of shares outstanding. Hoi Po Yuen is the second largest shareholder owning 3.5% of common stock, and Fidelity International Ltd holds about 3.4% of the company stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of OSL Group

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own a reasonable proportion of OSL Group Limited. It has a market capitalization of just HK$4.5b, and insiders have HK$1.5b worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public -- including retail investors -- own 55% of OSL Group. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand OSL Group better, we need to consider many other factors. For example, we've discovered 2 warning signs for OSL Group (1 makes us a bit uncomfortable!) that you should be aware of before investing here.

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.