Key Insights

• Significant control over Asymchem Laboratories (Tianjin) by retail investors implies that the general public has more power to influence management and governance-related decisions
• 50% of the business is held by the top 9 shareholders
• 26% of Asymchem Laboratories (Tianjin) is held by Institutions

A look at the shareholders of Asymchem Laboratories (Tianjin) Co., Ltd. (SZSE:002821) can tell us which group is most powerful. The group holding the most number of shares in the company, around 35% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, retail investors collectively scored the highest last week as the company hit CN¥35b market cap following a 3.1% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Asymchem Laboratories (Tianjin).

What Does The Institutional Ownership Tell Us About Asymchem Laboratories (Tianjin)?

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.

Asymchem Laboratories (Tianjin) 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. 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 Asymchem Laboratories (Tianjin)'s historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Asymchem Laboratories (Tianjin). Looking at our data, we can see that the largest shareholder is Asymchem Laboratories, Inc. with 32% of shares outstanding. For context, the second largest shareholder holds about 4.6% of the shares outstanding, followed by an ownership of 3.9% by the third-largest shareholder. Hao Hong, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

On further inspection, we found that more than half the company's shares are owned by the top 9 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 Asymchem Laboratories (Tianjin)

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. 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.

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 some shares in Asymchem Laboratories (Tianjin) Co., Ltd.. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around CN¥1.5b worth of shares (at current prices). 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

The general public-- including retail investors -- own 35% 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

Our data indicates that Private Companies hold 33%, of the company's shares. 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. For instance, we've identified 2 warning signs for Asymchem Laboratories (Tianjin) (1 is potentially serious) that 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.