Key Insights

• The considerable ownership by individual investors in NanJi E-Commerce indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 44% of the company
• Insider ownership in NanJi E-Commerce is 30%

To get a sense of who is truly in control of NanJi E-Commerce Co., LTD (SZSE:002127), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 56% to be precise, is individual investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders who own 30% came under pressure after market cap dropped to CN¥6.9b last week,individual investors took the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about NanJi E-Commerce.

What Does The Institutional Ownership Tell Us About NanJi E-Commerce?

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.

Since institutions own only a small portion of NanJi E-Commerce, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

NanJi E-Commerce is not owned by hedge funds. With a 29% stake, CEO Yu Xiang Zhang is the largest shareholder. NanJi E-Commerce Co., LTD, ESOP is the second largest shareholder owning 5.1% of common stock, and Wujiang XinMin Industry Investment Co., Ltd. holds about 4.0% of the company stock.

A deeper look at our ownership data shows that the top 25 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of NanJi E-Commerce

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. 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.

It seems insiders own a significant proportion of NanJi E-Commerce Co., LTD. Insiders have a CN¥2.1b stake in this CN¥6.9b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 56% of NanJi E-Commerce. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

It seems that Private Companies own 7.1%, of the NanJi E-Commerce stock. 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. For instance, we've identified 1 warning sign for NanJi E-Commerce 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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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.