The Recent 11% Gain Must Have Brightened CEO Ting Keung Lam's Week, Radiance Holdings (Group) Company Limited's (HKG:9993) Most Bullish Insider

Key Insights

Significant insider control over Radiance Holdings (Group) implies vested interests in company growth
84% of the company is held by a single shareholder (Ting Keung Lam)
Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of Radiance Holdings (Group) Company Limited (HKG:9993), it is important to understand the ownership structure of the business. We can see that individual insiders own the lion's share in the company with 84% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders were the biggest beneficiaries of last week's 11% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Radiance Holdings (Group).

ownership-breakdown — SEHK:9993 Ownership Breakdown March 20th 2024

What Does The Lack Of Institutional Ownership Tell Us About Radiance Holdings (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 multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Radiance Holdings (Group) might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growth — SEHK:9993 Earnings and Revenue Growth March 20th 2024

Radiance Holdings (Group) is not owned by hedge funds. With a 84% stake, CEO Ting Keung Lam is the largest shareholder. This implies that they possess majority interests and have significant control over the company. Investors usually consider it a good sign when the company leadership has such a significant stake, as this is widely perceived to increase the chance that the management will act in the best interests of the company. With 0.1% and 0.07% of the shares outstanding respectively, Dimensional Fund Advisors LP and The Vanguard Group, Inc. 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. 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 Radiance Holdings (Group)

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 Radiance Holdings (Group) Company Limited. This means they can collectively make decisions for the company. That means insiders have a very meaningful HK$6.7b stake in this HK$7.9b business. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Radiance Holdings (Group). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

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 5 warning signs for Radiance Holdings (Group) you should be aware of, and 2 of them are concerning.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.