Despite recent sales, Truly International Holdings Limited (HKG:732) insiders own 46% shares but recent downturn may have set them back

By
Simply Wall St
Published
April 12, 2022
SEHK:732
Source: Shutterstock

Every investor in Truly International Holdings Limited (HKG:732) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 46% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Even though insiders have sold shares recently, the group owns the most numbers of shares in the company. As a result, the group bore the brunt of last week’s HK$921m market cap loss.

Let's delve deeper into each type of owner of Truly International Holdings, beginning with the chart below.

See our latest analysis for Truly International Holdings

ownership-breakdown
SEHK:732 Ownership Breakdown April 12th 2022

What Does The Institutional Ownership Tell Us About Truly International Holdings?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Truly International Holdings 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Truly International Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
SEHK:732 Earnings and Revenue Growth April 12th 2022

Truly International Holdings is not owned by hedge funds. The company's CEO Wai Lam is the largest shareholder with 46% of shares outstanding. RAYS Capital Partners Limited is the second largest shareholder owning 4.9% of common stock, and The Vanguard Group, Inc. holds about 1.4% of the company stock.

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

Insider Ownership Of Truly International 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.

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.

Our information suggests that insiders maintain a significant holding in Truly International Holdings Limited. Insiders have a HK$3.2b stake in this HK$6.9b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 43% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Truly International Holdings. 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.

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. Case in point: We've spotted 4 warning signs for Truly International Holdings you should be aware of.

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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