Individual investors are Kunming Chuan Jin Nuo Chemical Co., Ltd.'s (SZSE:300505) biggest owners and were hit after market cap dropped CN¥440m

Key Insights

• The considerable ownership by individual investors in Kunming Chuan Jin Nuo Chemical indicates that they collectively have a greater say in management and business strategy
• A total of 25 investors have a majority stake in the company with 46% ownership
• Insider ownership in Kunming Chuan Jin Nuo Chemical is 31%

The end of cancer? These 15 emerging AI stocks are developing tech that will allow early identification of life changing diseases like cancer and Alzheimer's.

To get a sense of who is truly in control of Kunming Chuan Jin Nuo Chemical Co., Ltd. (SZSE:300505), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 54% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders who own 31% came under pressure after market cap dropped to CN¥4.3b last week,individual investors took the most losses.

Let's delve deeper into each type of owner of Kunming Chuan Jin Nuo Chemical, beginning with the chart below.

Check out our latest analysis for Kunming Chuan Jin Nuo Chemical

What Does The Institutional Ownership Tell Us About Kunming Chuan Jin Nuo Chemical?

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 Kunming Chuan Jin Nuo Chemical. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Kunming Chuan Jin Nuo Chemical, (below). Of course, keep in mind that there are other factors to consider, too.

Kunming Chuan Jin Nuo Chemical is not owned by hedge funds. Meng Liu is currently the company's largest shareholder with 26% of shares outstanding. With 4.6% and 3.6% of the shares outstanding respectively, Nuode Asset Management Co., Ltd. and Caitong Fund Management Co., Ltd. are the second and third largest shareholders. In addition, we found that Jia Gui Wei, the CEO has 1.5% of the shares allocated to their name.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 Kunming Chuan Jin Nuo Chemical

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 information suggests that insiders maintain a significant holding in Kunming Chuan Jin Nuo Chemical Co., Ltd.. It has a market capitalization of just CN¥4.3b, and insiders have CN¥1.3b worth of shares in their own names. 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, who are usually individual investors, hold a substantial 54% stake in Kunming Chuan Jin Nuo Chemical, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

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. For example, we've discovered 1 warning sign for Kunming Chuan Jin Nuo Chemical that you should be aware of before investing here.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.