Private companies among Nan Pao Resins Chemical Co., Ltd.'s (TWSE:4766) largest shareholders, saw gain in holdings value after stock jumped 5.3% last week

Key Insights

• The considerable ownership by private companies in Nan Pao Resins Chemical indicates that they collectively have a greater say in management and business strategy
• A total of 7 investors have a majority stake in the company with 53% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

To get a sense of who is truly in control of Nan Pao Resins Chemical Co., Ltd. (TWSE:4766), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 40% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, private companies collectively scored the highest last week as the company hit NT$41b market cap following a 5.3% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Nan Pao Resins Chemical.

See our latest analysis for Nan Pao Resins Chemical

What Does The Institutional Ownership Tell Us About Nan Pao Resins Chemical?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Nan Pao Resins Chemical already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Nan Pao Resins Chemical's earnings history below. Of course, the future is what really matters.

Nan Pao Resins Chemical is not owned by hedge funds. The company's largest shareholder is Yue Yuen Industrial (Holdings) Limited, with ownership of 11%. Ding Feng Investment Co., Ltd is the second largest shareholder owning 9.2% of common stock, and Chuan-De Investment Co., Ltd. holds about 8.3% of the company stock.

We did some more digging and found that 7 of the top shareholders account for roughly 53% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Nan Pao Resins Chemical

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 Nan Pao Resins Chemical Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own NT$1.9b worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 35% stake in Nan Pao Resins Chemical. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

Our data indicates that Private Companies hold 40%, of the company's shares. 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.

Public Company Ownership

It appears to us that public companies own 11% of Nan Pao Resins Chemical. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of 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.

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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.