Do Institutions Own Tian An China Investments Company Limited (HKG:28) Shares?

By
Simply Wall St
Published
November 24, 2021
SEHK:28
Source: Shutterstock

The big shareholder groups in Tian An China Investments Company Limited (HKG:28) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

Tian An China Investments is not a large company by global standards. It has a market capitalization of HK$6.1b, which means it wouldn't have the attention of many institutional investors. Taking a look at our data on the ownership groups (below), it seems that institutions are not really that prevalent on the share registry. Let's delve deeper into each type of owner, to discover more about Tian An China Investments.

Check out our latest analysis for Tian An China Investments

ownership-breakdown
SEHK:28 Ownership Breakdown November 25th 2021

What Does The Lack Of Institutional Ownership Tell Us About Tian An China Investments?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

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. 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. 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 Tian An China Investments, for yourself, below.

earnings-and-revenue-growth
SEHK:28 Earnings and Revenue Growth November 25th 2021

Our data indicates that hedge funds own 26% of Tian An China Investments. That catches my attention because hedge funds sometimes try to influence management, or bring about changes that will create near term value for shareholders. Lee and Lee Trust is currently the largest shareholder, with 50% of shares outstanding. This implies that they have majority interest control of the future of the company. With 19% and 9.7% of the shares outstanding respectively, Penta Investment Advisers Ltd. and Sok Un Chong are the second and third largest shareholders.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Tian An China Investments

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

We can report that insiders do own shares in Tian An China Investments Company Limited. In their own names, insiders own HK$594m worth of stock in the HK$6.1b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 14% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 50%, of the Tian An China Investments stock. 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:

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. For example, we've discovered 3 warning signs for Tian An China Investments (1 is potentially serious!) that you should be aware of before investing here.

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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