On December 2, Hong Kong’s Securities and Futures Commission (SFC) disclosed the latest list of companies with highly concentrated shareholdings. According to the announcement, 98.90% of DEEWIN (HK:02418) shares are held by just ten major shareholders, indicating extreme concentration.
On the morning of December 3, DEEWIN’s stock price plummeted by over 40% at one point. Notably, since late September, the stock had surged by more than 300% before this sharp decline.
The SFC stated that its recent inquiry into DEEWIN’s shareholding structure revealed that, as of November 18, ten shareholders collectively held 546 million H-shares, accounting for 98.90% of the company’s issued H-share capital. This leaves only 6.0545 million H-shares (1.10%) in public hands. The regulator warned that due to the extreme concentration, even small trades could trigger significant price volatility, urging investors to exercise caution.
In response, DEEWIN confirmed that at least 25% of its issued shares were held by the public as of November 18. The company echoed the SFC’s warning, acknowledging that high shareholding concentration could lead to sharp price swings and limited market liquidity.
The SFC’s scrutiny triggered today’s sell-off, with DEEWIN’s intraday losses exceeding 40%.
Founded in 2014 and listed on the Hong Kong Stock Exchange in July 2022, DEEWIN is a major player in China’s commercial vehicle services sector, offering value-added solutions across the industry chain.
Historically a low-liquidity penny stock trading below HK$1, DEEWIN saw a sudden surge in October, peaking at HK$11.4 on November 14. The rally was likely fueled by a strategic partnership announced on October 9 with Yongqing Group to develop smart logistics solutions for an Indonesian industrial park.
This year, the SFC has flagged 14 companies for high shareholding concentration. Most, like Bit Strategy, Shandong Hi-Speed Holdings, and ZA Smart Living, saw steep declines post-announcement.
A notable case is Shandong Hi-Speed Holdings (HK:00412), which crashed 76% on September 19 after the SFC’s warning, having previously soared from HK$6 to HK$18.95.
However, exceptions exist. Despite being flagged in March, DeYi Holdings (renamed "Zhiyun Technology Construction") surged 271% this year, with its market cap exceeding HK$14.1 billion.
Analysts caution that heavily concentrated stocks are prone to manipulation and detached valuations, with thin liquidity amplifying volatility.
(Image source: Zhang Jian)
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