BEIJING CERTIFICATE AUTHORITY Co.,Ltd.'s (SZSE:300579) market cap touched CN¥8.3b last week, benefiting both individual investors who own 39% as well as institutions

Key Insights

• BEIJING CERTIFICATE AUTHORITYLtd's significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 2 shareholders own 52% of the company
• Institutional ownership in BEIJING CERTIFICATE AUTHORITYLtd is 29%

To get a sense of who is truly in control of BEIJING CERTIFICATE AUTHORITY Co.,Ltd. (SZSE:300579), it is important to understand the ownership structure of the business. With 39% stake, individual investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While individual investors were the group that reaped the most benefits after last week’s 11% price gain, institutions also received a 29% cut.

In the chart below, we zoom in on the different ownership groups of BEIJING CERTIFICATE AUTHORITYLtd.

View our latest analysis for BEIJING CERTIFICATE AUTHORITYLtd

What Does The Institutional Ownership Tell Us About BEIJING CERTIFICATE AUTHORITYLtd?

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.

We can see that BEIJING CERTIFICATE AUTHORITYLtd does have institutional investors; and they hold a good portion of the company's stock. 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 BEIJING CERTIFICATE AUTHORITYLtd, (below). Of course, keep in mind that there are other factors to consider, too.

BEIJING CERTIFICATE AUTHORITYLtd is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Beijing State-Owned Assets Management Co., Ltd. with 26% of shares outstanding. For context, the second largest shareholder holds about 26% of the shares outstanding, followed by an ownership of 2.7% by the third-largest shareholder. Bang Hua Zhan, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. Furthermore, CEO Xue Yan Lin is the owner of 0.7% of the company's shares.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of BEIJING CERTIFICATE AUTHORITYLtd

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. 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.

Shareholders would probably be interested to learn that insiders own shares in BEIJING CERTIFICATE AUTHORITY Co.,Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around CN¥318m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 39% stake in BEIJING CERTIFICATE AUTHORITYLtd. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Public Company Ownership

We can see that public companies hold 26% of the BEIJING CERTIFICATE AUTHORITYLtd shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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. Be aware that BEIJING CERTIFICATE AUTHORITYLtd is showing 2 warning signs in our investment analysis , and 1 of those doesn't sit too well with us...

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.

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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.