Key Insights

• Significant control over Ocumension Therapeutics by private equity firms implies that the general public has more power to influence management and governance-related decisions
• The top 4 shareholders own 54% of the company
• Insiders own 23% of Ocumension Therapeutics

If you want to know who really controls Ocumension Therapeutics (HKG:1477), then you'll have to look at the makeup of its share registry. With 35% stake, private equity firms possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 9.2% decline in share price, private equity firms suffered the most losses.

Let's take a closer look to see what the different types of shareholders can tell us about Ocumension Therapeutics.

What Does The Institutional Ownership Tell Us About Ocumension Therapeutics?

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.

We can see that Ocumension Therapeutics does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Ocumension Therapeutics, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Ocumension Therapeutics. Lian Yong Chen is currently the largest shareholder, with 18% of shares outstanding. With 18% and 11% of the shares outstanding respectively, 6 Dimensions Capital, L.P. and Boyu Capital Group Holdings Ltd. are the second and third largest shareholders. In addition, we found that Ye Liu, the CEO has 4.6% of the shares allocated to their name.

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 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Ocumension Therapeutics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our information suggests that insiders maintain a significant holding in Ocumension Therapeutics. Insiders have a HK$1.1b stake in this HK$4.8b business. 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

With a 28% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Ocumension Therapeutics. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With an ownership of 35%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Ocumension Therapeutics better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com