Jilin Yatai (Group) Co., Ltd.'s (SHSE:600881) market cap dropped CN¥422m last week; individual investors who hold 51% were hit as were institutions

Simply Wall St · 10/21 22:14

Key Insights

A look at the shareholders of Jilin Yatai (Group) Co., Ltd. (SHSE:600881) can tell us which group is most powerful. We can see that retail investors own the lion's share in the company with 51% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions who own 18% came under pressure after market cap dropped to CN¥4.9b last week,retail investors took the most losses.

Let's delve deeper into each type of owner of Jilin Yatai (Group), beginning with the chart below.

View our latest analysis for Jilin Yatai (Group)

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SHSE:600881 Ownership Breakdown October 21st 2024

What Does The Institutional Ownership Tell Us About Jilin Yatai (Group)?

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 Jilin Yatai (Group). 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Jilin Yatai (Group)'s historic earnings and revenue below, but keep in mind there's always more to the story.

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SHSE:600881 Earnings and Revenue Growth October 21st 2024

Jilin Yatai (Group) is not owned by hedge funds. State-Owned Assets Supervision and Administration Commission of Changchun is currently the largest shareholder, with 9.1% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.1% and 5.0%, of the shares outstanding, respectively.

On studying our ownership data, we found that 21 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Jilin Yatai (Group)

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our data suggests that insiders own under 1% of Jilin Yatai (Group) Co., Ltd. in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It appears that the board holds about CN¥5.8m worth of stock. This compares to a market capitalization of CN¥4.9b. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 51% of Jilin Yatai (Group) shares. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

Private Company Ownership

We can see that Private Companies own 9.7%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Public Company Ownership

Public companies currently own 12% of Jilin Yatai (Group) stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Jilin Yatai (Group) (of which 1 is a bit unpleasant!) you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.