Retail investors among IGG Inc's (HKG:799) largest stockholders and were hit after last week's 10% price drop

Key Insights

• Significant control over IGG by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 45% of the company
• 39% of IGG is held by insiders

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To get a sense of who is truly in control of IGG Inc (HKG:799), 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 55% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders, who own 39% shares weren’t spared from last week’s HK$485m market cap drop, retail investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of IGG.

View our latest analysis for IGG

What Does The Institutional Ownership Tell Us About IGG?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

IGG already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 IGG's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in IGG. Looking at our data, we can see that the largest shareholder is the CEO Zongjian Cai with 19% of shares outstanding. In comparison, the second and third largest shareholders hold about 14% and 2.5% of the stock. Interestingly, the second-largest shareholder, Yuan Chi is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of IGG

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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders maintain a significant holding in IGG Inc. Insiders have a HK$1.9b stake in this HK$4.9b business. 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 55% stake in IGG, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 1 warning sign for IGG that you should be aware of before investing here.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.