Key Insights

• The considerable ownership by retail investors in Shenwan Hongyuan Group indicates that they collectively have a greater say in management and business strategy
• 51% of the business is held by the top 3 shareholders
• Institutional ownership in Shenwan Hongyuan Group is 19%

A look at the shareholders of Shenwan Hongyuan Group Co., Ltd. (SZSE:000166) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 27% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And private equity firms on the other hand have a 26% ownership in the company.

In the chart below, we zoom in on the different ownership groups of Shenwan Hongyuan Group.

What Does The Institutional Ownership Tell Us About Shenwan Hongyuan Group?

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.

As you can see, institutional investors have a fair amount of stake in Shenwan Hongyuan Group. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Shenwan Hongyuan Group's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Shenwan Hongyuan Group. The company's largest shareholder is China Jianyin Investment Limited, with ownership of 26%. With 20% and 4.8% of the shares outstanding respectively, Central Huijin Investment Ltd. and Shanghai Jiushi (Group) Co., Ltd. are the second and third largest shareholders.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Shenwan Hongyuan Group

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

With a 27% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shenwan Hongyuan Group. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Equity Ownership

Private equity firms hold a 26% stake in Shenwan Hongyuan Group. This suggests they can be influential in key policy decisions. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

It seems that Private Companies own 8.5%, of the Shenwan Hongyuan Group 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenwan Hongyuan Group better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Shenwan Hongyuan Group you should be aware of.

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.