Retail investors are Porton Pharma Solutions Ltd.'s (SZSE:300363) biggest owners and were hit after market cap dropped CN¥415m

Key Insights

• The considerable ownership by retail investors in Porton Pharma Solutions indicates that they collectively have a greater say in management and business strategy
• The top 9 shareholders own 51% of the company
• Insider ownership in Porton Pharma Solutions is 27%

Every investor in Porton Pharma Solutions Ltd. (SZSE:300363) should be aware of the most powerful shareholder groups. With 40% stake, retail investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders who own 27% came under pressure after market cap dropped to CN¥6.9b last week,retail investors took the most losses.

In the chart below, we zoom in on the different ownership groups of Porton Pharma Solutions.

Check out our latest analysis for Porton Pharma Solutions

What Does The Institutional Ownership Tell Us About Porton Pharma Solutions?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Porton Pharma Solutions already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Porton Pharma Solutions' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Porton Pharma Solutions. Our data shows that Chong Qing Liang Jiang New Area Development & Investment Group Co.,Ltd. is the largest shareholder with 14% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 8.1% of the stock. Nianfeng Ju, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

We also observed that the top 9 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.

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 Porton Pharma Solutions

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

It seems insiders own a significant proportion of Porton Pharma Solutions Ltd.. Insiders have a CN¥1.9b stake in this CN¥6.9b 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 40% stake in Porton Pharma Solutions. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 16%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Porton Pharma Solutions better, we need to consider many other factors. Be aware that Porton Pharma Solutions is showing 1 warning sign in our investment analysis , 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.