Stock Analysis

What Is The Ownership Structure Like For High Tech Pharm Co., Ltd. (KOSDAQ:106190)?

KOSDAQ:A106190
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The big shareholder groups in High Tech Pharm Co., Ltd. (KOSDAQ:106190) have power over the company. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

High Tech Pharm is not a large company by global standards. It has a market capitalization of ₩111b, which means it wouldn't have the attention of many institutional investors. In the chart below, we can see that institutions are not really that prevalent on the share registry. Let's take a closer look to see what the different types of shareholders can tell us about High Tech Pharm.

See our latest analysis for High Tech Pharm

ownership-breakdown
KOSDAQ:A106190 Ownership Breakdown December 16th 2020

What Does The Lack Of Institutional Ownership Tell Us About High Tech Pharm?

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. Alternatively, there might be something about the company that has kept institutional investors away. High Tech Pharm might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

earnings-and-revenue-growth
KOSDAQ:A106190 Earnings and Revenue Growth December 16th 2020

High Tech Pharm is not owned by hedge funds. The company's largest shareholder is ACS Dobfar S.p.A., with ownership of 40%. For context, the second largest shareholder holds about 4.0% of the shares outstanding, followed by an ownership of 1.6% by the third-largest shareholder. Jeong-Soo Kim, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

On studying our ownership data, we found that 7 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of High Tech Pharm

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 High Tech Pharm Co., Ltd.. In their own names, insiders own ₩6.3b worth of stock in the ₩111b company. This shows at least some alignment, but I usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- mostly retail investors -- own 54% of High Tech Pharm. This level of ownership gives retail investors the power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

We can see that Private Companies own 40%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. For instance, we've identified 2 warning signs for High Tech Pharm (1 is concerning) that you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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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