Stock Analysis

What Kind Of Shareholders Hold The Majority In Tong Ren Tang Technologies Co. Ltd.'s (HKG:1666) Shares?

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SEHK:1666
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The big shareholder groups in Tong Ren Tang Technologies Co. Ltd. (HKG:1666) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Companies that have been privatized tend to have low insider ownership.

Tong Ren Tang Technologies isn't enormous, but it's not particularly small either. It has a market capitalization of HK$7.0b, which means it would generally expect to see some institutions on the share registry. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. Let's delve deeper into each type of owner, to discover more about Tong Ren Tang Technologies.

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SEHK:1666 Ownership Breakdown December 3rd 2020

What Does The Institutional Ownership Tell Us About Tong Ren Tang Technologies?

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.

Tong Ren Tang Technologies already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Tong Ren Tang Technologies, (below). Of course, keep in mind that there are other factors to consider, too.

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SEHK:1666 Earnings and Revenue Growth December 3rd 2020

Tong Ren Tang Technologies is not owned by hedge funds. China Beijing Tong Ren Tang Group Co. Ltd. is currently the company's largest shareholder with 48% of shares outstanding. Hillhouse Capital Management, Ltd. is the second largest shareholder owning 3.7% of common stock, and Sainan Yuan holds about 2.8% of the company stock.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Tong Ren Tang Technologies

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.

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.

We can see that insiders own shares in Tong Ren Tang Technologies Co. Ltd.. It has a market capitalization of just HK$7.0b, and insiders have HK$197m worth of shares, in their own names. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 33% ownership, the general public have some degree of sway over Tong Ren Tang Technologies. 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.

Private Company Ownership

We can see that Private Companies own 48%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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 Tong Ren Tang Technologies is showing 1 warning sign in our investment analysis , you should know about...

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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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