Key Insights

• Insiders appear to have a vested interest in Sprocomm Intelligence's growth, as seen by their sizeable ownership
• The top 2 shareholders own 67% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

If you want to know who really controls Sprocomm Intelligence Limited (HKG:1401), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 67% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders were the biggest beneficiaries of last week's 15% gain.

Let's delve deeper into each type of owner of Sprocomm Intelligence, beginning with the chart below.

Check out our latest analysis for Sprocomm Intelligence

What Does The Lack Of Institutional Ownership Tell Us About Sprocomm Intelligence?

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 could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. 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 Sprocomm Intelligence, for yourself, below.

Hedge funds don't have many shares in Sprocomm Intelligence. The company's CEO Chengjun Li is the largest shareholder with 37% of shares outstanding. For context, the second largest shareholder holds about 31% of the shares outstanding, followed by an ownership of 7.5% by the third-largest shareholder. Interestingly, the second-largest shareholder, Bin Xiong is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

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.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Sprocomm Intelligence

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 most recent data indicates that insiders own the majority of Sprocomm Intelligence Limited. This means they can collectively make decisions for the company. So they have a HK$2.3b stake in this HK$3.4b business. 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

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Sprocomm Intelligence. 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

We can see that Private Companies own 7.5%, of the shares on issue. 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. To that end, you should learn about the 4 warning signs we've spotted with Sprocomm Intelligence (including 3 which shouldn't be ignored) .

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.