Wuxi Taiji Industry Limited Corporation's (SHSE:600667) largest shareholders are retail investors who were rewarded as market cap surged CN¥484m last week

Simply Wall St · 08/30 22:23

Key Insights

  • Significant control over Wuxi Taiji Industry Limited by retail investors implies that the general public has more power to influence management and governance-related decisions
  • A total of 25 investors have a majority stake in the company with 47% ownership
  • Institutions own 11% of Wuxi Taiji Industry Limited

Every investor in Wuxi Taiji Industry Limited Corporation (SHSE:600667) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 53% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, retail investors collectively scored the highest last week as the company hit CN¥11b market cap following a 4.5% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Wuxi Taiji Industry Limited.

Check out our latest analysis for Wuxi Taiji Industry Limited

ownership-breakdown
SHSE:600667 Ownership Breakdown August 30th 2024

What Does The Institutional Ownership Tell Us About Wuxi Taiji Industry Limited?

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.

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

earnings-and-revenue-growth
SHSE:600667 Earnings and Revenue Growth August 30th 2024

We note that hedge funds don't have a meaningful investment in Wuxi Taiji Industry Limited. The company's largest shareholder is Wuxi Industry Development Group Co., Ltd., with ownership of 30%. Meanwhile, the second and third largest shareholders, hold 4.0% and 3.6%, of the shares outstanding, respectively.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Wuxi Taiji Industry Limited

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Shareholders would probably be interested to learn that insiders own shares in Wuxi Taiji Industry Limited Corporation. 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¥120m worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public -- including retail investors -- own 53% of Wuxi Taiji Industry Limited. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Equity Ownership

With a stake of 30%, private equity firms could influence the Wuxi Taiji Industry Limited 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.

Private Company Ownership

We can see that Private Companies own 4.0%, 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.

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. Take risks for example - Wuxi Taiji Industry Limited has 1 warning sign we think you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.