Owning 40% in Jiangsu Xinquan Automotive Trim Co.,Ltd. (SHSE:603179) means that insiders are heavily invested in the company's future

Key Insights

• Jiangsu Xinquan Automotive TrimLtd's significant insider ownership suggests inherent interests in company's expansion
• A total of 8 investors have a majority stake in the company with 51% ownership
• 26% of Jiangsu Xinquan Automotive TrimLtd is held by Institutions

To get a sense of who is truly in control of Jiangsu Xinquan Automotive Trim Co.,Ltd. (SHSE:603179), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 40% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

So, insiders of Jiangsu Xinquan Automotive TrimLtd have a lot at stake and every decision they make on the company’s future is important to them from a financial point of view.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangsu Xinquan Automotive TrimLtd.

View our latest analysis for Jiangsu Xinquan Automotive TrimLtd

What Does The Institutional Ownership Tell Us About Jiangsu Xinquan Automotive TrimLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Jiangsu Xinquan Automotive TrimLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Jiangsu Xinquan Automotive TrimLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Jiangsu Xinquan Automotive TrimLtd is not owned by hedge funds. With a 39% stake, CEO Zhi Tang is the largest shareholder. In comparison, the second and third largest shareholders hold about 2.5% and 1.9% of the stock.

On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Jiangsu Xinquan Automotive TrimLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our most recent data indicates that insiders own a reasonable proportion of Jiangsu Xinquan Automotive Trim Co.,Ltd.. It has a market capitalization of just CN¥21b, and insiders have CN¥8.6b worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 33% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. To that end, you should learn about the 2 warning signs we've spotted with Jiangsu Xinquan Automotive TrimLtd (including 1 which is a bit concerning) .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.