CK Life Sciences Int'l., (Holdings) Inc.'s (HKG:775) market cap dropped HK$481m last week; Public companies bore the brunt

Key Insights

• CK Life Sciences Int'l. (Holdings)'s significant public companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 2 shareholders own 67% of the company
• 22% of CK Life Sciences Int'l. (Holdings) is held by insiders

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Every investor in CK Life Sciences Int'l., (Holdings) Inc. (HKG:775) should be aware of the most powerful shareholder groups. We can see that public companies own the lion's share in the company with 45% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to HK$8.4b last week, public companies would have faced the highest losses than any other shareholder groups of the company.

In the chart below, we zoom in on the different ownership groups of CK Life Sciences Int'l. (Holdings).

View our latest analysis for CK Life Sciences Int'l. (Holdings)

What Does The Lack Of Institutional Ownership Tell Us About CK Life Sciences Int'l. (Holdings)?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

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. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. CK Life Sciences Int'l. (Holdings)'s earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

We note that hedge funds don't have a meaningful investment in CK Life Sciences Int'l. (Holdings). CK Hutchison Holdings Limited is currently the company's largest shareholder with 45% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 22% and 7.5%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 CK Life Sciences Int'l. (Holdings)

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

It seems insiders own a significant proportion of CK Life Sciences Int'l., (Holdings) Inc.. Insiders own HK$1.9b worth of shares in the HK$8.4b 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, who are usually individual investors, hold a 25% stake in CK Life Sciences Int'l. (Holdings). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 7.5%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

Public companies currently own 45% of CK Life Sciences Int'l. (Holdings) stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

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. Take risks for example - CK Life Sciences Int'l. (Holdings) has 2 warning signs we think you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free 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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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.