Institutions along with public companies who hold considerable shares inPoly Property Services Co., Ltd. (HKG:6049) come under pressure; lose 7.9% of holdings value

Key Insights

• Significant control over Poly Property Services by public companies implies that the general public has more power to influence management and governance-related decisions
• Poly Developments and Holdings Group Co., Ltd. owns 73% of the company
• Institutions own 16% of Poly Property Services

If you want to know who really controls Poly Property Services Co., Ltd. (HKG:6049), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are public companies with 73% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 7.9% decrease in the stock price last week, public companies suffered the most losses, but institutions who own 16% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Poly Property Services.

Check out our latest analysis for Poly Property Services

What Does The Institutional Ownership Tell Us About Poly Property Services?

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.

Poly Property Services already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Poly Property Services' historic earnings and revenue below, but keep in mind there's always more to the story.

Poly Property Services is not owned by hedge funds. The company's largest shareholder is Poly Developments and Holdings Group Co., Ltd., with ownership of 73%. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. With 1.6% and 1.4% of the shares outstanding respectively, AEGON-Industrial Fund Management Co. Ltd. and Hillhouse Investment Management, Ltd. are the second and third largest shareholders.

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

Insider Ownership Of Poly Property Services

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 Poly Property Services Co., Ltd. insiders own under 1% of the company. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around HK$2.9m worth of shares (at current prices). 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, who are usually individual investors, hold a 12% stake in Poly Property Services. 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 73% of Poly Property Services. 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.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.