Guangdong Tapai Group Co., Ltd.'s (SZSE:002233) market cap rose CN¥386m last week; retail investors who hold 44% profited and so did insiders

Key Insights

• The considerable ownership by retail investors in Guangdong Tapai Group indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 8 shareholders
• Insiders own 41% of Guangdong Tapai Group

A look at the shareholders of Guangdong Tapai Group Co., Ltd. (SZSE:002233) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 44% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that benefitted the most from last week’s CN¥386m market cap gain, insiders too had a 41% share in those profits.

In the chart below, we zoom in on the different ownership groups of Guangdong Tapai Group.

View our latest analysis for Guangdong Tapai Group

What Does The Institutional Ownership Tell Us About Guangdong Tapai Group?

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.

Guangdong Tapai Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Guangdong Tapai Group's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Guangdong Tapai Group. The company's largest shareholder is Lie Zhong, with ownership of 17%. With 9.7% and 8.0% of the shares outstanding respectively, Qian Peng and Yongshou Xu are the second and third largest shareholders.

We also observed that the top 8 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Guangdong Tapai Group

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

It seems insiders own a significant proportion of Guangdong Tapai Group Co., Ltd.. Insiders own CN¥3.7b worth of shares in the CN¥9.1b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 44% stake in Guangdong Tapai Group. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Guangdong Tapai Group better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Guangdong Tapai Group , and understanding them should be part of your investment process.

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.