Getein Biotech, Inc's (SHSE:603387) Market Cap Dropped CN¥370m Last Week; Individual Investors Bore the Brunt

Simply Wall St ·  Oct 19, 2023 23:39

Key Insights

  • Significant control over Getein Biotech by individual investors implies that the general public has more power to influence management and governance-related decisions
  • A total of 15 investors have a majority stake in the company with 50% ownership
  • Insider ownership in Getein Biotech is 41%

A look at the shareholders of Getein Biotech, Inc (SHSE:603387) can tell us which group is most powerful. The group holding the most number of shares in the company, around 49% 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 41% shares weren't spared from last week's CN¥370m market cap drop, individual investors as a group suffered the maximum losses

In the chart below, we zoom in on the different ownership groups of Getein Biotech.

View our latest analysis for Getein Biotech

SHSE:603387 Ownership Breakdown October 20th 2023

What Does The Institutional Ownership Tell Us About Getein Biotech?

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.

Getein Biotech 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. 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 Getein Biotech's earnings history below. Of course, the future is what really matters.

SHSE:603387 Earnings and Revenue Growth October 20th 2023

Hedge funds don't have many shares in Getein Biotech. Our data shows that En Ben Su is the largest shareholder with 40% of shares outstanding. Nanjing Aiji Business Information Consulting Co., Ltd. is the second largest shareholder owning 3.5% of common stock, and Aeon Life Insurance Co. Ltd., Asset Management Arm holds about 1.4% of the company stock.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 15 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Getein Biotech

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 Getein Biotech, Inc. It has a market capitalization of just CN¥5.4b, and insiders have CN¥2.2b worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Getein Biotech. 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

It seems that Private Companies own 3.5%, of the Getein Biotech stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 3 warning signs with Getein Biotech , and understanding them should be part of your investment process.

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.

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