As global markets respond to the recent Federal Reserve rate cut, Hong Kong's Hang Seng Index has seen a notable gain of 5.12%, reflecting a positive sentiment despite mixed economic signals from China. In this context, identifying growth companies with high insider ownership can be particularly compelling for investors looking to navigate these dynamic market conditions. In the following article, we will explore three such companies listed on the SEHK that are poised for significant earnings growth.
Top 10 Growth Companies With High Insider Ownership In Hong Kong
Overview: iDreamSky Technology Holdings Limited operates a digital entertainment platform that publishes games through mobile apps and websites in the People’s Republic of China, with a market cap of HK$3.45 billion.
Operations: The company generates revenue primarily from publishing games through mobile apps and websites in the People’s Republic of China.
Insider Ownership: 18.9%
Earnings Growth Forecast: 128% p.a.
iDreamSky Technology Holdings, a leading digital entertainment platform in China, has high insider ownership and is expected to achieve significant revenue growth of 42.4% annually, outpacing the Hong Kong market's 7.3%. Despite recent financial setbacks with a net loss of CNY 109.82 million for H1 2024, the company has initiated a substantial share buyback program and entered into strategic partnerships in Saudi Arabia's eSports sector to bolster future growth and global influence.
Overview: Meituan operates as a technology retail company in the People's Republic of China with a market cap of approximately HK$821.64 billion.
Operations: The company's revenue segments include New Initiatives generating CN¥77.56 billion and Core Local Commerce contributing CN¥228.13 billion.
Insider Ownership: 11.6%
Earnings Growth Forecast: 25.8% p.a.
Meituan, a major Chinese e-commerce platform, demonstrates strong growth potential with earnings forecasted to grow 25.84% annually, outpacing the Hong Kong market's 11.7%. Recent financial results show significant improvement with net income doubling to CNY 16.72 billion for H1 2024. The company has also been active in share buybacks, repurchasing over HKD 14 billion worth of shares this year, indicating confidence in its long-term prospects despite low insider buying recently.
Overview: Bairong Inc. operates as a cloud-based AI turnkey services provider in China with a market cap of HK$3.81 billion.
Operations: The company's revenue segments include cloud-based AI turnkey services in China.
Insider Ownership: 19.1%
Earnings Growth Forecast: 28.1% p.a.
Bairong, a financial technology company in Hong Kong, shows promising growth with revenues forecasted to grow 15% annually, outpacing the local market. Despite a recent decline in net income to CNY 139.96 million for H1 2024 from CNY 205.25 million last year, the company remains undervalued at 51.8% below its estimated fair value. Insider ownership is high, and earnings are expected to grow significantly over the next three years at an annual rate of 28.1%.
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.The analysis only considers stock directly held by insiders. It does not include indirectly owned stock through other vehicles such as corporate and/or trust entities. All forecast revenue and earnings growth rates quoted are in terms of annualised (per annum) growth rates over 1-3 years.
Companies discussed in this article include SEHK:1119 SEHK:3690 and SEHK:6608.
