DongKoo Bio & Pharma Co., Ltd.'s (KOSDAQ:006620) market cap rose ₩15b last week; retail investors who hold 60% profited and so did insiders

Key Insights

• DongKoo Bio & Pharma's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 8 investors have a majority stake in the company with 40% ownership
• Insiders own 39% of DongKoo Bio & Pharma

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To get a sense of who is truly in control of DongKoo Bio & Pharma Co., Ltd. (KOSDAQ:006620), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 60% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 10% increase in the stock price last week, retail investors profited the most, but insiders who own 39% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of DongKoo Bio & Pharma.

Check out our latest analysis for DongKoo Bio & Pharma

What Does The Lack Of Institutional Ownership Tell Us About DongKoo Bio & Pharma?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. DongKoo Bio & Pharma might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

DongKoo Bio & Pharma is not owned by hedge funds. With a 31% stake, CEO Cho Yong-Jun is the largest shareholder. With 6.6% and 1.4% of the shares outstanding respectively, Kyoung-Ok Lee and Do-Hyoung Kim are the second and third largest shareholders.

On studying our ownership data, we found that 8 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. 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 DongKoo Bio & Pharma

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 DongKoo Bio & Pharma Co., Ltd.. Insiders own ₩63b worth of shares in the ₩162b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 60% of DongKoo Bio & Pharma. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

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. Consider for instance, the ever-present spectre of investment risk. We've identified 4 warning signs with DongKoo Bio & Pharma , and understanding them should be part of your investment process.

Of course this may not be the best stock to buy. So take a peek at this free 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.