Individual investors who have a significant stake must be disappointed along with institutions after Jiangsu Alcha Aluminium Group Co., Ltd.'s (SZSE:002160) market cap dropped by CN¥413m

Key Insights

• Jiangsu Alcha Aluminium Group's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 48% of the business is held by the top 25 shareholders
• Institutional ownership in Jiangsu Alcha Aluminium Group is 33%

Every investor in Jiangsu Alcha Aluminium Group Co., Ltd. (SZSE:002160) should be aware of the most powerful shareholder groups. With 52% 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.

While institutions who own 33% came under pressure after market cap dropped to CN¥3.3b last week,individual investors took the most losses.

In the chart below, we zoom in on the different ownership groups of Jiangsu Alcha Aluminium Group.

See our latest analysis for Jiangsu Alcha Aluminium Group

What Does The Institutional Ownership Tell Us About Jiangsu Alcha Aluminium 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 Jiangsu Alcha Aluminium 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. 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 Jiangsu Alcha Aluminium Group, (below). Of course, keep in mind that there are other factors to consider, too.

Jiangsu Alcha Aluminium Group is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Qilu Finance Investment Group Co., Ltd., Asset Management Arm with 30% of shares outstanding. Changshu Aluminium Foil Factory Co., Ltd. is the second largest shareholder owning 8.2% of common stock, and Ping Zhang holds about 3.0% of the company stock.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Jiangsu Alcha Aluminium Group

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

We can see that insiders own shares in Jiangsu Alcha Aluminium Group Co., Ltd.. It has a market capitalization of just CN¥3.3b, and insiders have CN¥215m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 52% stake in Jiangsu Alcha Aluminium Group, suggesting it is a fairly popular stock. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

Our data indicates that Private Companies hold 8.8%, of the company's shares. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.