CEO Xiaodong Zheng, Tofflon Science and Technology Group Co., Ltd.'s (SZSE:300171) largest shareholder sees value of holdings go down 4.3% after recent drop

Key Insights

• Tofflon Science and Technology Group's significant insider ownership suggests inherent interests in company's expansion
• The largest shareholder of the company is Xiaodong Zheng with a 51% stake
• Institutional ownership in Tofflon Science and Technology Group is 18%

A look at the shareholders of Tofflon Science and Technology Group Co., Ltd. (SZSE:300171) can tell us which group is most powerful. With 52% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to CN¥11b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Tofflon Science and Technology Group, beginning with the chart below.

View our latest analysis for Tofflon Science and Technology Group

What Does The Institutional Ownership Tell Us About Tofflon Science and Technology Group?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Tofflon Science and Technology Group. 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 Tofflon Science and Technology Group's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Tofflon Science and Technology Group. Looking at our data, we can see that the largest shareholder is the CEO Xiaodong Zheng with 51% of shares outstanding. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. The second and third largest shareholders are Shanghai Biomedical Industry Equity Fund Management Co., Ltd. and Guotou China Merchant Investment Management Co., Ltd., with an equal amount of shares to their name at 3.2%.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Tofflon Science and Technology Group

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

It seems that insiders own more than half the Tofflon Science and Technology Group Co., Ltd. stock. This gives them a lot of power. Insiders own CN¥5.6b worth of shares in the CN¥11b company. That's extraordinary! Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 30% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Tofflon Science and Technology Group better, we need to consider many other factors. For example, we've discovered 2 warning signs for Tofflon Science and Technology Group (1 is concerning!) that you should be aware of before investing here.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.