Key Insights

• Shanghai Yizhong Pharmaceutical's significant individual 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
• Insiders own 24% of Shanghai Yizhong Pharmaceutical

To get a sense of who is truly in control of Shanghai Yizhong Pharmaceutical Co., Ltd. (SHSE:688091), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 49% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders who own 24% came under pressure after market cap dropped to CN¥5.0b last week,individual investors took the most losses.

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

What Does The Institutional Ownership Tell Us About Shanghai Yizhong Pharmaceutical?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Less than 5% of Shanghai Yizhong Pharmaceutical is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Shanghai Yizhong Pharmaceutical is not owned by hedge funds. With a 20% stake, CEO Jingsong Zhou is the largest shareholder. Shanghai Kaibao Pharmaceutical CO.,Ltd is the second largest shareholder owning 12% of common stock, and Shanghai Shanyuan Enterprise Management Partnership Enterprise (Limited Partnership) holds about 4.7% of the company stock.

After doing some more digging, we found that the top 13 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Yizhong Pharmaceutical

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 a reasonable proportion of Shanghai Yizhong Pharmaceutical Co., Ltd.. It has a market capitalization of just CN¥5.0b, and insiders have CN¥1.2b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 49% stake in Shanghai Yizhong Pharmaceutical. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 12%, of the shares on issue. 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.

Public Company Ownership

It appears to us that public companies own 12% of Shanghai Yizhong Pharmaceutical. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shanghai Yizhong Pharmaceutical better, we need to consider many other factors. For example, we've discovered 2 warning signs for Shanghai Yizhong Pharmaceutical (1 shouldn't be ignored!) that you should be aware of before investing here.

Of course this may not be the best stock to buy. So take a peek at this free 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.