S E A Holdings Limited's (HKG:251) biggest owners are private companies who got richer after stock soared 14% last week

Key Insights

• The considerable ownership by private companies in S E A Holdings indicates that they collectively have a greater say in management and business strategy
• 56% of the company is held by a single shareholder (JCS Limited)
• Insider ownership in S E A Holdings is 18%

To get a sense of who is truly in control of S E A Holdings Limited (HKG:251), it is important to understand the ownership structure of the business. With 56% stake, private companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit HK$933m market cap following a 14% gain in the stock.

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

View our latest analysis for S E A Holdings

What Does The Lack Of Institutional Ownership Tell Us About S E A Holdings?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. Alternatively, there might be something about the company that has kept institutional investors away. 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 S E A Holdings, for yourself, below.

S E A Holdings is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is JCS Limited with 56% of shares outstanding. This implies that they have majority interest control of the future of the company. With 18% and 1.0% of the shares outstanding respectively, Wing Chi Lu and Dimensional Fund Advisors LP are the second and third largest shareholders. Wing Chi Lu, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. 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 S E A Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own a reasonable proportion of S E A Holdings Limited. Insiders have a HK$173m stake in this HK$933m business. 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 24% stake in the company, and hence can't easily be ignored. 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

Our data indicates that Private Companies hold 56%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand S E A Holdings better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with S E A Holdings .

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.