After the recent decline, GR Life Style Company Limited (HKG:108) CEO Chunxian Wei's holdings have lost 8.2% of their value

Key Insights

• GR Life Style's significant insider ownership suggests inherent interests in company's expansion
• 56% of the business is held by the top 2 shareholders
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

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A look at the shareholders of GR Life Style Company Limited (HKG:108) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 49% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As market cap fell to HK$7.6b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

Let's take a closer look to see what the different types of shareholders can tell us about GR Life Style.

View our latest analysis for GR Life Style

What Does The Lack Of Institutional Ownership Tell Us About GR Life Style?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of GR Life Style, for yourself, below.

We note that hedge funds don't have a meaningful investment in GR Life Style. The company's CEO Chunxian Wei is the largest shareholder with 45% of shares outstanding. For context, the second largest shareholder holds about 12% of the shares outstanding, followed by an ownership of 4.2% by the third-largest shareholder. Interestingly, the third-largest shareholder, Zhongmin Sun is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of GR Life Style

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.

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.

It seems insiders own a significant proportion of GR Life Style Company Limited. Insiders have a HK$3.7b stake in this HK$7.6b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 39% stake in GR Life Style. 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

It seems that Private Companies own 12%, of the GR Life Style stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

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 - GR Life Style has 2 warning signs we think you should be aware of.

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.