Individual investors among Shanghai Yizhong Pharmaceutical Co., Ltd.'s (SHSE:688091) largest stockholders and were hit after last week's 6.1% price drop

Key Insights

• The considerable ownership by individual investors in Shanghai Yizhong Pharmaceutical indicates that they collectively have a greater say in management and business strategy
• A total of 6 investors have a majority stake in the company with 52% ownership
• 30% of Shanghai Yizhong Pharmaceutical is held by insiders

To get a sense of who is truly in control of Shanghai Yizhong Pharmaceutical Co., Ltd. (SHSE:688091), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual investors with 42% ownership. 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 30% shares weren’t spared from last week’s CN¥454m market cap drop, individual investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of Shanghai Yizhong Pharmaceutical.

See our latest analysis for Shanghai Yizhong Pharmaceutical

What Does The Institutional Ownership Tell Us About Shanghai Yizhong Pharmaceutical?

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.

Institutions have a very small stake in Shanghai Yizhong Pharmaceutical. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

Shanghai Yizhong Pharmaceutical is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Jingsong Zhou with 20% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 12% and 10%, of the shares outstanding, respectively. Interestingly, the third-largest shareholder, Duan Li is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

We did some more digging and found that 6 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Shanghai Yizhong Pharmaceutical

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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.

Our information suggests that insiders maintain a significant holding in Shanghai Yizhong Pharmaceutical Co., Ltd.. Insiders have a CN¥2.1b stake in this CN¥7.0b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 42% stake in Shanghai Yizhong Pharmaceutical. 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.

Private Company Ownership

Our data indicates that Private Companies hold 12%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Public Company Ownership

It appears to us that public companies own 12% of Shanghai Yizhong Pharmaceutical. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Shanghai Yizhong Pharmaceutical you should know about.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.