Sipai Health Technology Co., Ltd.'s (HKG:314) market cap surged HK$208m last week, retail investors who have a lot riding on the company were rewarded

Key Insights

• Significant control over Sipai Health Technology by retail investors implies that the general public has more power to influence management and governance-related decisions
• 55% of the business is held by the top 5 shareholders
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

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A look at the shareholders of Sipai Health Technology Co., Ltd. (HKG:314) can tell us which group is most powerful. With 36% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, retail investors collectively scored the highest last week as the company hit HK$2.1b market cap following a 11% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Sipai Health Technology.

See our latest analysis for Sipai Health Technology

What Does The Institutional Ownership Tell Us About Sipai Health Technology?

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.

We can see that Sipai Health Technology does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Sipai Health Technology, (below). Of course, keep in mind that there are other factors to consider, too.

Sipai Health Technology is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Tencent Holdings Limited with 28% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.7% and 7.6% of the stock. Xuguang Ma, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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 Sipai Health Technology

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.

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.

We can report that insiders do own shares in Sipai Health Technology Co., Ltd.. As individuals, the insiders collectively own HK$158m worth of the HK$2.1b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 36% stake in Sipai Health Technology. 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 Equity Ownership

Private equity firms hold a 14% stake in Sipai Health Technology. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

It seems that Private Companies own 5.3%, of the Sipai Health Technology stock. 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.

Public Company Ownership

Public companies currently own 28% of Sipai Health Technology stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Sipai Health Technology better, we need to consider many other factors. Be aware that Sipai Health Technology is showing 1 warning sign in our investment analysis , you should know about...

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.