Key Insights

• Shanghai Taisheng Wind Power Equipment's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 13 investors have a majority stake in the company with 50% ownership
• Insider ownership in Shanghai Taisheng Wind Power Equipment is 11%

To get a sense of who is truly in control of Shanghai Taisheng Wind Power Equipment Co., Ltd. (SZSE:300129), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 42% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, retail investors benefitted the most after the company's market cap rose by CN¥393m last week.

Let's take a closer look to see what the different types of shareholders can tell us about Shanghai Taisheng Wind Power Equipment.

What Does The Institutional Ownership Tell Us About Shanghai Taisheng Wind Power Equipment?

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 Shanghai Taisheng Wind Power Equipment does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Taisheng Wind Power Equipment, (below). Of course, keep in mind that there are other factors to consider, too.

Shanghai Taisheng Wind Power Equipment is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Guangzhou Kaide Investment Holding Co., Ltd. with 27% of shares outstanding. In comparison, the second and third largest shareholders hold about 3.8% and 3.6% of the stock. Zhicheng Liu, who is the third-largest shareholder, also happens to hold the title of Chairman Emeritus.

A closer look at our ownership figures suggests that the top 13 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Shanghai Taisheng Wind Power Equipment

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 a reasonable proportion of Shanghai Taisheng Wind Power Equipment Co., Ltd.. It has a market capitalization of just CN¥7.4b, and insiders have CN¥832m worth of shares in their own names. That's quite significant. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 42% stake in Shanghai Taisheng Wind Power Equipment. 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

With a stake of 27%, private equity firms could influence the Shanghai Taisheng Wind Power Equipment board. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 2 warning signs for Shanghai Taisheng Wind Power Equipment (1 is a bit concerning) that you should be aware of.

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.