Key Insights

• The considerable ownership by individual investors in Shanghai Tongji Science&Technology IndustrialLtd indicates that they collectively have a greater say in management and business strategy
• 43% of the business is held by the top 18 shareholders
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

Every investor in Shanghai Tongji Science&Technology Industrial Co.,Ltd (SHSE:600846) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 57% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, individual investors endured the biggest losses as the stock fell by 7.3%.

Let's take a closer look to see what the different types of shareholders can tell us about Shanghai Tongji Science&Technology IndustrialLtd.

What Does The Institutional Ownership Tell Us About Shanghai Tongji Science&Technology IndustrialLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Shanghai Tongji Science&Technology IndustrialLtd. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Shanghai Tongji Science&Technology IndustrialLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Shanghai Tongji Science&Technology IndustrialLtd. Looking at our data, we can see that the largest shareholder is Shanghai Yangpu Binjiang Investment Development Co., Ltd. with 23% of shares outstanding. In comparison, the second and third largest shareholders hold about 14% and 1.2% of the stock.

Our studies suggest that the top 18 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. 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 Shanghai Tongji Science&Technology IndustrialLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Our most recent data indicates that insiders own less than 1% of Shanghai Tongji Science&Technology Industrial Co.,Ltd. However, it's possible that insiders might have an indirect interest through a more complex structure. It seems the board members have no more than CN¥148k worth of shares in the CN¥4.6b company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public -- including retail investors -- own 57% of Shanghai Tongji Science&Technology IndustrialLtd. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Private Company Ownership

We can see that Private Companies own 38%, of the shares on issue. 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. To that end, you should learn about the 3 warning signs we've spotted with Shanghai Tongji Science&Technology IndustrialLtd (including 2 which can't be ignored) .

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.