Retail investors are Jiangsu Dingsheng New Materials Joint-Stock Co.,Ltd's (SHSE:603876) biggest owners and were hit after market cap dropped CN¥614m

Simply Wall St · 10/18 00:13

Key Insights

  • Significant control over Jiangsu Dingsheng New Materials Ltd by retail investors implies that the general public has more power to influence management and governance-related decisions
  • A total of 3 investors have a majority stake in the company with 50% ownership
  • Insider ownership in Jiangsu Dingsheng New Materials Ltd is 11%

A look at the shareholders of Jiangsu Dingsheng New Materials Joint-Stock Co.,Ltd (SHSE:603876) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 32% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to CN¥8.2b last week, retail investors would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Jiangsu Dingsheng New Materials Ltd, beginning with the chart below.

View our latest analysis for Jiangsu Dingsheng New Materials Ltd

ownership-breakdown
SHSE:603876 Ownership Breakdown October 18th 2024

What Does The Institutional Ownership Tell Us About Jiangsu Dingsheng New Materials Ltd?

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.

Jiangsu Dingsheng New Materials Ltd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Jiangsu Dingsheng New Materials Ltd, (below). Of course, keep in mind that there are other factors to consider, too.

earnings-and-revenue-growth
SHSE:603876 Earnings and Revenue Growth October 18th 2024

We note that hedge funds don't have a meaningful investment in Jiangsu Dingsheng New Materials Ltd. Hangzhou Dingsheng Industrial Group Co.,Ltd. is currently the largest shareholder, with 28% of shares outstanding. The second and third largest shareholders are Gongqingcheng Purun Investment Management Partnership Enterprise (Limited Partnership) and Xianhai Zhou, with an equal amount of shares to their name at 11%.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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

Insider Ownership Of Jiangsu Dingsheng New Materials Ltd

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 information suggests that insiders maintain a significant holding in Jiangsu Dingsheng New Materials Joint-Stock Co.,Ltd. Insiders own CN¥933m worth of shares in the CN¥8.2b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Jiangsu Dingsheng New Materials Ltd. 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 11%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

Our data indicates that Private Companies hold 29%, of the company's shares. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 3 warning signs for Jiangsu Dingsheng New Materials Ltd you should be aware of, and 1 of them is significant.

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.