Hong Kong's securities regulator advised investors to "exercise extreme caution" when dealing in the shares of Riverine China Holdings (HKG:1417), as the high concentration of shareholding among a small number of stockholders could result in volatile share prices.

The watchdog said that following an investigation, its findings suggested that 20 shareholders held 62.4 million shares in the property manager, or 15.41% of its total issued shares as of Aug. 14.

Coupled with the 74.12% stake held by two substantial shareholders, they cornered 94.42% of Riverine, the regulator said, whose report was disclosed by the company itself Wednesday.

As a result, only 30.7 million shares, or 7.6% of the issued shares, were in the hands of other shareholders, Hong Kong's Securities and Futures Commission said.

In response, Riverine China said it would conduct further investigations into the matters raised by the SFC. The company added that, based on available information, at least 25% of its issued shares were in public hands as of Aug. 14 and the Sept. 1 announcement, and that it had maintained sufficient public float.