Key Insights

• Significant control over Shanghai Hile Bio-Technology by individual investors implies that the general public has more power to influence management and governance-related decisions
• A total of 5 investors have a majority stake in the company with 51% ownership
• 21% of Shanghai Hile Bio-Technology is held by insiders

A look at the shareholders of Shanghai Hile Bio-Technology Co., Ltd. (SHSE:603718) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual investors with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, individual investors were the biggest beneficiaries of last week's 13% gain.

Let's delve deeper into each type of owner of Shanghai Hile Bio-Technology, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Shanghai Hile Bio-Technology?

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.

Less than 5% of Shanghai Hile Bio-Technology is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. 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.

We note that hedge funds don't have a meaningful investment in Shanghai Hile Bio-Technology. Shanghai Haoyuan Venture Capital Development Co., Ltd. is currently the largest shareholder, with 34% of shares outstanding. Jianping Zhang is the second largest shareholder owning 4.9% of common stock, and Zhangle Fang holds about 4.5% of the company stock.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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

Insider Ownership Of Shanghai Hile Bio-Technology

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.

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.

It seems insiders own a significant proportion of Shanghai Hile Bio-Technology Co., Ltd.. It has a market capitalization of just CN¥6.2b, and insiders have CN¥1.3b worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 43% stake in the company, and hence can't easily be ignored. 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 34%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. Take risks for example - Shanghai Hile Bio-Technology has 3 warning signs (and 1 which can't be ignored) we think you should know about.

Of course this may not be the best stock to buy. So take a peek at this free 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.