Hailun Piano Co.,Ltd.'s (SZSE:300329) market cap dropped CN¥134m last week; Individual investors bore the brunt

Key Insights

• The considerable ownership by individual investors in Hailun PianoLtd indicates that they collectively have a greater say in management and business strategy
• A total of 12 investors have a majority stake in the company with 50% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of Hailun Piano Co.,Ltd. (SZSE:300329) can tell us which group is most powerful. We can see that individual investors own the lion's share in the company with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to CN¥953m last week, individual investors would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Hailun PianoLtd, beginning with the chart below.

Check out our latest analysis for Hailun PianoLtd

What Does The Institutional Ownership Tell Us About Hailun PianoLtd?

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.

We can see that Hailun PianoLtd does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Hailun PianoLtd's earnings history below. Of course, the future is what really matters.

Hailun PianoLtd is not owned by hedge funds. The company's largest shareholder is Ningbo Peilun Hailun Investment Co., Ltd., with ownership of 27%. Meanwhile, the second and third largest shareholders, hold 17% and 1.7%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 12 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over 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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Hailun PianoLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

Our data suggests that insiders own under 1% of Hailun Piano Co.,Ltd. in their own names. But they may have an indirect interest through a corporate structure that we haven't picked up on. It seems the board members have no more than CN¥5.4m worth of shares in the CN¥953m company. Many investors in smaller companies prefer to see the board more heavily invested. 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

We can see that Private Companies own 45%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hailun PianoLtd better, we need to consider many other factors. For instance, we've identified 2 warning signs for Hailun PianoLtd (1 doesn't sit too well with us) that 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.