retail investors who own 49% along with institutions invested in Chinasoft International Limited (HKG:354) saw increase in their holdings value last week

Key Insights

• Chinasoft International's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 25 investors have a majority stake in the company with 49% ownership
• 27% of Chinasoft International is held by Institutions

We check all companies for important risks. See what we found for Chinasoft International in our free report.

A look at the shareholders of Chinasoft International Limited (HKG:354) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 49% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 4.3% increase in the stock price last week, retail investors profited the most, but institutions who own 27% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of Chinasoft International, beginning with the chart below.

Check out our latest analysis for Chinasoft International

What Does The Institutional Ownership Tell Us About Chinasoft International?

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.

We can see that Chinasoft International 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. 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 Chinasoft International's historic earnings and revenue below, but keep in mind there's always more to the story.

Chinasoft International is not owned by hedge funds. Our data shows that Dan Capital Management Ltd. is the largest shareholder with 14% of shares outstanding. Yuhong Chen is the second largest shareholder owning 9.2% of common stock, and UBS Asset Management AG holds about 6.5% of the company stock. Yuhong Chen, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Chinasoft International

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 most recent data indicates that insiders own some shares in Chinasoft International Limited. This is a big company, so it is good to see this level of alignment. Insiders own HK$1.2b worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

With a 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Chinasoft International. 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 Equity Ownership

With a stake of 14%, private equity firms could influence the Chinasoft International board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

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.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.

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

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.