Shuibo Li Kunshan Kinglai Hygienic Materials Co.,Ltd.'s (SZSE:300260) CEO is the most bullish insider, and their stock value gained 4.6%last week

Key Insights

• Insiders appear to have a vested interest in Kunshan Kinglai Hygienic MaterialsLtd's growth, as seen by their sizeable ownership
• 56% of the business is held by the top 4 shareholders
• 21% of Kunshan Kinglai Hygienic MaterialsLtd is held by Institutions

To get a sense of who is truly in control of Kunshan Kinglai Hygienic Materials Co.,Ltd. (SZSE:300260), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 58% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders were the biggest beneficiaries of last week’s 4.6% gain.

In the chart below, we zoom in on the different ownership groups of Kunshan Kinglai Hygienic MaterialsLtd.

Check out our latest analysis for Kunshan Kinglai Hygienic MaterialsLtd

What Does The Institutional Ownership Tell Us About Kunshan Kinglai Hygienic MaterialsLtd?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Kunshan Kinglai Hygienic MaterialsLtd. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Kunshan Kinglai Hygienic MaterialsLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Kunshan Kinglai Hygienic MaterialsLtd. The company's CEO Shuibo Li is the largest shareholder with 25% of shares outstanding. With 17% and 6.9% of the shares outstanding respectively, Anyun Shen and Baihua Li are the second and third largest shareholders. Interestingly, the third-largest shareholder, Baihua Li is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

On looking further, we found that 56% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Kunshan Kinglai Hygienic MaterialsLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

It seems that insiders own more than half the Kunshan Kinglai Hygienic Materials Co.,Ltd. stock. This gives them a lot of power. Insiders own CN¥4.9b worth of shares in the CN¥8.4b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Kunshan Kinglai Hygienic MaterialsLtd. 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. Take risks for example - Kunshan Kinglai Hygienic MaterialsLtd has 1 warning sign we think you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.

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