Individual investors invested in Kunshan TopA Intelligent Equipment Co.,Ltd (SZSE:300836) copped the brunt of last week's CN¥342m market cap decline

Key Insights

• Kunshan TopA Intelligent EquipmentLtd's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 51% of the business is held by the top 8 shareholders
• Insiders own 43% of Kunshan TopA Intelligent EquipmentLtd

Every investor in Kunshan TopA Intelligent Equipment Co.,Ltd (SZSE:300836) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual investors with 43% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of individual investors took a hit after last week’s 11% price drop, insiders with their 43% also suffered.

Let's take a closer look to see what the different types of shareholders can tell us about Kunshan TopA Intelligent EquipmentLtd.

View our latest analysis for Kunshan TopA Intelligent EquipmentLtd

What Does The Institutional Ownership Tell Us About Kunshan TopA Intelligent EquipmentLtd?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Kunshan TopA Intelligent EquipmentLtd 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. 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 TopA Intelligent EquipmentLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Kunshan TopA Intelligent EquipmentLtd. With a 25% stake, CEO Chaopeng Xiao is the largest shareholder. Meanwhile, the second and third largest shareholders, hold 7.2% and 5.3%, of the shares outstanding, respectively. Interestingly, the second-largest shareholder, Lihua Zhu is also Chief Financial Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.

We did some more digging and found that 8 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Kunshan TopA Intelligent EquipmentLtd

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.

Our most recent data indicates that insiders own a reasonable proportion of Kunshan TopA Intelligent Equipment Co.,Ltd. Insiders have a CN¥1.2b stake in this CN¥2.9b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 43% 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 3 warning signs we've spotted with Kunshan TopA Intelligent EquipmentLtd (including 1 which is a bit unpleasant) .

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.