Individual investors are China Ruyi Holdings Limited's (HKG:136) biggest owners and were hit after market cap dropped HK$1.6b

Key Insights

• Significant control over China Ruyi Holdings by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 42% of the company
• Insider ownership in China Ruyi Holdings is 15%

A look at the shareholders of China Ruyi Holdings Limited (HKG:136) can tell us which group is most powerful. We can see that individual investors own the lion's share in the company with 58% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to HK$27b last week, individual investors would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about China Ruyi Holdings.

View our latest analysis for China Ruyi Holdings

What Does The Institutional Ownership Tell Us About China Ruyi Holdings?

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.

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

Hedge funds don't have many shares in China Ruyi Holdings. Looking at our data, we can see that the largest shareholder is Tencent Holdings Limited with 20% of shares outstanding. For context, the second largest shareholder holds about 15% of the shares outstanding, followed by an ownership of 1.7% by the third-largest shareholder. Liming Ke, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

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 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of China Ruyi Holdings

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.

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 China Ruyi Holdings Limited. It is very interesting to see that insiders have a meaningful HK$4.1b stake in this HK$27b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 58% stake in China Ruyi Holdings, suggesting it is a fairly popular stock. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Public Company Ownership

It appears to us that public companies own 20% of China Ruyi Holdings. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand China Ruyi Holdings better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for China Ruyi Holdings you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com