Retail investors are Changsha DIALINE New Material Sci.&Tech. Co., Ltd.'s (SZSE:300700) biggest owners and were hit after market cap dropped CN¥398m

Key Insights

• The considerable ownership by retail investors in Changsha DIALINE New Material Sci.&Tech indicates that they collectively have a greater say in management and business strategy
• The top 7 shareholders own 51% of the company
• Insider ownership in Changsha DIALINE New Material Sci.&Tech is 25%

To get a sense of who is truly in control of Changsha DIALINE New Material Sci.&Tech. Co., Ltd. (SZSE:300700), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 48% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 12% decrease in the stock price last week, retail investors suffered the most losses, but insiders who own 25% stock also took a hit.

Let's delve deeper into each type of owner of Changsha DIALINE New Material Sci.&Tech, beginning with the chart below.

See our latest analysis for Changsha DIALINE New Material Sci.&Tech

What Does The Institutional Ownership Tell Us About Changsha DIALINE New Material Sci.&Tech?

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.

Institutions have a very small stake in Changsha DIALINE New Material Sci.&Tech. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. So if the company itself can improve over time, we may well see more institutional buyers in the future. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Changsha DIALINE New Material Sci.&Tech is not owned by hedge funds. Hunan Chengxiyi Technology Co., Ltd is currently the company's largest shareholder with 20% of shares outstanding. In comparison, the second and third largest shareholders hold about 17% and 8.0% of the stock.

We also observed that the top 7 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Changsha DIALINE New Material Sci.&Tech

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 insiders own a significant proportion of Changsha DIALINE New Material Sci.&Tech. Co., Ltd.. Insiders have a CN¥772m stake in this CN¥3.0b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 48% 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.

Private Company Ownership

Our data indicates that Private Companies hold 23%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Changsha DIALINE New Material Sci.&Tech better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Changsha DIALINE New Material Sci.&Tech you should be aware of.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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.