Key Insights

• Significant control over Shenyang Xingqi PharmaceuticalLtd 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 24 shareholders
• Insiders own 31% of Shenyang Xingqi PharmaceuticalLtd

Every investor in Shenyang Xingqi Pharmaceutical Co.,Ltd. (SZSE:300573) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders, who own 31% shares weren't spared from last week's CN¥854m market cap drop, retail investors as a group suffered the maximum losses

Let's delve deeper into each type of owner of Shenyang Xingqi PharmaceuticalLtd, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Shenyang Xingqi PharmaceuticalLtd?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Shenyang Xingqi PharmaceuticalLtd. 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 Shenyang Xingqi PharmaceuticalLtd, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Shenyang Xingqi PharmaceuticalLtd. Jidong Liu is currently the company's largest shareholder with 28% of shares outstanding. For context, the second largest shareholder holds about 4.6% of the shares outstanding, followed by an ownership of 2.9% by the third-largest shareholder. Additionally, the company's CEO E. Gao directly holds 1.2% of the total shares outstanding.

A closer look at our ownership figures suggests that the top 24 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Shenyang Xingqi PharmaceuticalLtd

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 a reasonable proportion of Shenyang Xingqi Pharmaceutical Co.,Ltd.. Insiders own CN¥4.7b worth of shares in the CN¥15b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public-- including retail investors -- own 48% stake in the company, and hence can't easily be ignored. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shenyang Xingqi PharmaceuticalLtd better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Shenyang Xingqi PharmaceuticalLtd you should know about.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.