Private Companies Boost Hong Fok's Market Cap by S$66m

Hong Fok Corporation Limited (SGX:H30) has witnessed a significant surge in its market capitalization, with private companies emerging as the biggest beneficiaries. Last week, the company's market cap rose by S$66 million, rewarding its major shareholders, particularly private companies.

The ownership structure of Hong Fok Corporation Limited is dominated by private companies, which hold a substantial 40.1% stake in the company. The top 25 shareholders own a combined 69.84% of the company, with private companies accounting for a significant portion of this figure. The largest private company shareholder, Hong Fok Land Holding Limited, holds a 21.7% stake in the company.


The recent market cap increase can be attributed to the company's strong financial performance and the strategic moves of its major shareholders. Hong Fok Corporation Limited reported a profit of S$41.8 million for the financial year 2021, reflecting the company's robust business operations. Additionally, the company's major shareholders, including private companies, have been actively engaged in share buybacks and other strategic initiatives to enhance shareholder value.


Insider trading activities, such as share buybacks, have played a crucial role in the surge of Hong Fok's market capitalization. Major shareholders, including private companies, have been actively buying back shares, indicating their confidence in the company's prospects. For instance, Cheong Sim Eng, a significant shareholder, engaged in a share buyback of 222,600 shares in March 2022. Similarly, Hong Fok Land Asia Limited and Hong Fok Land Holding Limited conducted share buybacks in November 2020, acquiring a total of 250,000 shares.


The involvement of private companies as major shareholders in Hong Fok Corporation Limited has contributed significantly to the recent market cap increase. Their strategic investments and engagement in insider trading activities have helped boost the company's value. As the company continues to deliver strong financial performance and implement strategic initiatives, the potential for further market cap growth remains promising.