Individual investors own 23% of Hang Lung Properties Limited (HKG:101) shares but public companies control 63% of the company

Key Insights

• Significant control over Hang Lung Properties by public companies implies that the general public has more power to influence management and governance-related decisions
• 63% of the company is held by a single shareholder (Hang Lung Group Limited)
• 13% of Hang Lung Properties is held by Institutions

A look at the shareholders of Hang Lung Properties Limited (HKG:101) can tell us which group is most powerful. The group holding the most number of shares in the company, around 63% to be precise, is public companies. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And individual investors on the other hand have a 23% ownership in the company.

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

View our latest analysis for Hang Lung Properties

What Does The Institutional Ownership Tell Us About Hang Lung Properties?

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.

As you can see, institutional investors have a fair amount of stake in Hang Lung Properties. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Hang Lung Properties' historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Hang Lung Properties. Hang Lung Group Limited is currently the largest shareholder, with 63% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. The Vanguard Group, Inc. is the second largest shareholder owning 1.7% of common stock, and Schroder Investment Management Limited holds about 1.5% of the company stock.

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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Hang Lung Properties

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 Hang Lung Properties Limited insiders own under 1% of the company. Keep in mind that it's a big company, and the insiders own HK$179m worth of shares. The absolute value might be more important than the proportional share. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 23% stake in the company, and hence can't easily be ignored. 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.

Public Company Ownership

It appears to us that public companies own 63% of Hang Lung Properties. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Hang Lung Properties better, we need to consider many other factors. For example, we've discovered 2 warning signs for Hang Lung Properties that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com