Dong Yi Ri Sheng Home Decoration Group Co.,Ltd.'s (SZSE:002713) biggest owners are private companies who got richer after stock soared 15% last week

Key Insights

• The considerable ownership by private companies in Dong Yi Ri Sheng Home Decoration GroupLtd indicates that they collectively have a greater say in management and business strategy
• The top 5 shareholders own 51% of the company
• 12% of Dong Yi Ri Sheng Home Decoration GroupLtd is held by Institutions

To get a sense of who is truly in control of Dong Yi Ri Sheng Home Decoration Group Co.,Ltd. (SZSE:002713), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 40% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, private companies benefitted the most after the company's market cap rose by CN¥273m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Dong Yi Ri Sheng Home Decoration GroupLtd.

See our latest analysis for Dong Yi Ri Sheng Home Decoration GroupLtd

What Does The Institutional Ownership Tell Us About Dong Yi Ri Sheng Home Decoration GroupLtd?

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 Dong Yi Ri Sheng Home Decoration GroupLtd 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. 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 Dong Yi Ri Sheng Home Decoration GroupLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Dong Yi Ri Sheng Home Decoration GroupLtd. The company's largest shareholder is Tianjin Dongyi Tianzheng Investment Co., Ltd., with ownership of 24%. Meanwhile, the second and third largest shareholders, hold 16% and 5.0%, of the shares outstanding, respectively. Furthermore, CEO Hui Chen is the owner of 1.4% of the company's shares.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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 Dong Yi Ri Sheng Home Decoration GroupLtd

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own some shares in Dong Yi Ri Sheng Home Decoration Group Co.,Ltd.. In their own names, insiders own CN¥54m worth of stock in the CN¥2.1b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 39% stake in Dong Yi Ri Sheng Home Decoration GroupLtd. 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 40%, 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.

Public Company Ownership

We can see that public companies hold 6.2% of the Dong Yi Ri Sheng Home Decoration GroupLtd shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Dong Yi Ri Sheng Home Decoration GroupLtd has 3 warning signs we think you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.