Key Insights

• The considerable ownership by private companies in Bio-Thera Solutions indicates that they collectively have a greater say in management and business strategy
• A total of 4 investors have a majority stake in the company with 54% ownership
• Institutional ownership in Bio-Thera Solutions is 11%

If you want to know who really controls Bio-Thera Solutions, Ltd. (SHSE:688177), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private companies with 51% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, private companies endured the biggest losses as the stock fell by 12%.

Let's delve deeper into each type of owner of Bio-Thera Solutions, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Bio-Thera Solutions?

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.

Bio-Thera Solutions already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Bio-Thera Solutions' historic earnings and revenue below, but keep in mind there's always more to the story.

Bio-Thera Solutions is not owned by hedge funds. Guangzho Hedy Group Co., Ltd. is currently the largest shareholder, with 39% of shares outstanding. Guangzhou Qiaoxing Investment Partnership Enterprise (Limited Partnership) is the second largest shareholder owning 5.6% of common stock, and Guangzhou Zhongke Yuechuang Incubator Investment Management Co., Ltd. holds about 5.2% of the company stock. Additionally, the company's CEO Shengfeng Li directly holds 1.6% of the total shares outstanding.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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

Insider Ownership Of Bio-Thera Solutions

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our most recent data indicates that insiders own some shares in Bio-Thera Solutions, Ltd.. The insiders have a meaningful stake worth CN¥821m. Most would see this as a real positive. 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

With a 26% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Bio-Thera Solutions. 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 5.2% stake in Bio-Thera Solutions. 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 51%, of the Bio-Thera Solutions 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:

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. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Bio-Thera Solutions , and understanding them should be part of your investment process.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.