Key Takeaways
Hong Kong’s securities regulator warned investors that Modern Chinese Medicine Group’s (1643.HK) public float has fallen to just 9.4 percent.
The Securities and Futures Commission recently conducted an enquiry showing 90.6% of the company was held by a small group of 25 shareholders as of March 30.
The SFC's findings showed that the group of 25 shareholders and their related parties collectively held 650 million shares. This left only 67.67 million shares, or 9.4% of the issued share capital, in the hands of other investors.
"Given the high concentration of shareholding among a small number of shareholders, even a small number of shares traded could result in significant price volatility," the SFC said in a statement.
The regulator's public warning could dampen investor confidence and increase selling pressure on the thinly-traded stock. Shareholders and prospective investors are advised by the SFC to exercise caution when dealing in the company’s shares.
This article is for informational purposes only and does not constitute investment advice.
