While insiders own 34% of Kingfa Sci. & Tech. Co., Ltd. (SHSE:600143), individual investors are its largest shareholders with 58% ownership

Key Insights

• Significant control over Kingfa Sci. & Tech by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 25 investors have a majority stake in the company with 42% ownership
• 34% of Kingfa Sci. & Tech is held by insiders

A look at the shareholders of Kingfa Sci. & Tech. Co., Ltd. (SHSE:600143) can tell us which group is most powerful. With 58% stake, individual investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual insiders on the other hand have a 34% ownership in the company. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.

In the chart below, we zoom in on the different ownership groups of Kingfa Sci. & Tech.

Check out our latest analysis for Kingfa Sci. & Tech

What Does The Institutional Ownership Tell Us About Kingfa Sci. & Tech?

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 Kingfa Sci. & Tech. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Kingfa Sci. & Tech, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Kingfa Sci. & Tech. Looking at our data, we can see that the largest shareholder is Zhimin Yuan with 20% of shares outstanding. Haitao Xiong is the second largest shareholder owning 4.7% of common stock, and Nan Jing Li holds about 3.7% of the company stock. Nan Jing Li, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Kingfa Sci. & Tech

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems insiders own a significant proportion of Kingfa Sci. & Tech. Co., Ltd.. Insiders own CN¥7.7b worth of shares in the CN¥23b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public -- including retail investors -- own 58% of Kingfa Sci. & Tech. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Kingfa Sci. & Tech better, we need to consider many other factors. Take risks for example - Kingfa Sci. & Tech has 3 warning signs (and 1 which makes us a bit uncomfortable) we think you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.