It’s usually clear who the millionaires will be at most big companies. But the millionaires at one Chinese company aren’t just its top executives.
China’s Sunny Optical Technology Group (OTC: SNPTF) has seen its stock climb faster than any other stock in MSCI Inc.’s global indexes in the past decade, and its richest employees are just as likely to be janitors, cafeteria chefs, and factory workers as they are to be those in the corner offices.
According to a report from Bloomberg this week, the lens maker offered stakes to early employees regardless of their position, which has minted hundreds of millionaires at the company as its shares have skyrocketed more than 9,500% since May 2008. Compare that to Netflix’s 7,500% gain…
The company was founded by Wang Wenjian in 1984 on less than $10,000 in borrowed cash, and now has a market cap of $22 billion.
Sunny Optical’s millionaire early employees owe their riches to Wang, who opted to put profits into a trust for the company’s earliest employees when it restructured from a so-called village and township enterprise into a joint-stock company in the 1990s. The trust now has around 400 holders and owns 35% of the company.
Wang left a 6.8% stake for himself, but opened up the trust for quality inspectors, cleaners, and company cooks to buy shares in the company at a negligible price based on their years of employment, with the cheapest fee going to those who had been there the longest.
And amazingly, just a 0.013% stake in the employee trust would have been enough to mint a millionaire, and the average holding now translates to about $17 million per employee.
“When money gathers, people will be apart; when money is scattered, people with gather,” wrote Wang, who retired in 2012, in a book published last year on Sunny Optical’s history.
Sunny Optical was publicly listed in Hong Kong in 2007, and now employs roughly 28,000 staff with four production sites across China and offices in Taiwan, Singapore, Japan, South Korea, and the U.S.
So far this year, shares are up 60%, making the stock one of the best performers in Hong Kong’s benchmark Hang Seng Index. The company’s profit has surged more than sixfold in the last five years as demand for higher resolution cameras in smartphones has exploded.
The company believes it still has room to grow and has set a target to increase sales fivefold to 100 billion yuan—or $15.6 billion—in the next decade.
And according to Phelix Lee, an analyst at Sunwah Kingsway Capital Holdings in Hong Kong, the company “has leaped over the obstacles, transforming from a low-end lens maker into an innovative lens-solutions provider, which helps drive its share price.”