Individual investors invested in Jinan Acetate Chemical Co., Ltd. (TWSE:4763) copped the brunt of last week's NT$2.1b market cap decline

Key Insights

• The considerable ownership by individual investors in Jinan Acetate Chemical indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 6 shareholders
• 31% of Jinan Acetate Chemical is held by insiders

If you want to know who really controls Jinan Acetate Chemical Co., Ltd. (TWSE:4763), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 42% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders, who own 31% shares weren’t spared from last week’s NT$2.1b market cap drop, individual investors as a group suffered the maximum losses

Let's delve deeper into each type of owner of Jinan Acetate Chemical, beginning with the chart below.

Check out our latest analysis for Jinan Acetate Chemical

What Does The Institutional Ownership Tell Us About Jinan Acetate Chemical?

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.

Jinan Acetate Chemical already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Jinan Acetate Chemical, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Jinan Acetate Chemical. The company's largest shareholder is Kezhang Wang, with ownership of 29%. Meanwhile, the second and third largest shareholders, hold 13% and 3.0%, of the shares outstanding, respectively.

On further inspection, we found that more than half the company's shares are owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Jinan Acetate Chemical

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own a reasonable proportion of Jinan Acetate Chemical Co., Ltd.. It is very interesting to see that insiders have a meaningful NT$21b stake in this NT$66b business. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 42% stake in Jinan Acetate Chemical. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 18%, 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. Case in point: We've spotted 1 warning sign for Jinan Acetate Chemical you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.

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