Top Key Executive Kwok Lung Hon, Citychamp Watch & Jewellery Group Limited's (HKG:256) largest shareholder sees value of holdings go down 15% after recent drop

Key Insights

• Citychamp Watch & Jewellery Group's significant insider ownership suggests inherent interests in company's expansion
• 70% of the company is held by a single shareholder (Kwok Lung Hon)
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

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Every investor in Citychamp Watch & Jewellery Group Limited (HKG:256) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 70% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to HK$2.2b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about Citychamp Watch & Jewellery Group.

Check out our latest analysis for Citychamp Watch & Jewellery Group

What Does The Lack Of Institutional Ownership Tell Us About Citychamp Watch & Jewellery Group?

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. Alternatively, there might be something about the company that has kept institutional investors away. Citychamp Watch & Jewellery Group's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

We note that hedge funds don't have a meaningful investment in Citychamp Watch & Jewellery Group. Our data suggests that Kwok Lung Hon, who is also the company's Top Key Executive, holds the most number of shares at 70%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. Fujian Fengrong Investment Ltd. is the second largest shareholder owning 4.6% of common stock, and Dimensional Fund Advisors LP holds about 0.5% of the company stock.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Citychamp Watch & Jewellery Group

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders own more than half of Citychamp Watch & Jewellery Group Limited. This gives them effective control of the company. Given it has a market cap of HK$2.2b, that means they have HK$1.6b worth of shares. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 25% stake in Citychamp Watch & Jewellery Group. 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.

Private Company Ownership

It seems that Private Companies own 4.6%, of the Citychamp Watch & Jewellery Group stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. Take risks for example - Citychamp Watch & Jewellery Group has 1 warning sign we think you should be aware of.

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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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.