Private equity firms among Bloomage BioTechnology Corporation Limited’s (SHSE:688363) largest shareholders, saw gain in holdings value after stock jumped 3.2% last week

Key Insights

• Significant control over Bloomage BioTechnology by private equity firms implies that the general public has more power to influence management and governance-related decisions
• 59% of the company is held by a single shareholder (Huaxi Xinyu Investment Co., Ltd.)
• 15% of Bloomage BioTechnology is held by Institutions

To get a sense of who is truly in control of Bloomage BioTechnology Corporation Limited (SHSE:688363), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 66% to be precise, is private equity firms. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private equity firms were the biggest beneficiaries of last week’s 3.2% gain.

Let’s delve deeper into each type of owner of Bloomage BioTechnology, beginning with the chart below.

Check out our latest analysis for Bloomage BioTechnology

What Does The Institutional Ownership Tell Us About Bloomage BioTechnology?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Bloomage BioTechnology. 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. 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 Bloomage BioTechnology’s historic earnings and revenue below, but keep in mind there’s always more to the story.

Hedge funds don’t have many shares in Bloomage BioTechnology. Huaxi Xinyu Investment Co., Ltd. is currently the company’s largest shareholder with 59% of shares outstanding. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 7.1% of the shares outstanding, followed by an ownership of 2.6% by the third-largest 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Bloomage BioTechnology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

We can see that insiders own shares in Bloomage BioTechnology Corporation Limited. The insiders have a meaningful stake worth CN¥502m. Most would see this as a real positive. 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

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Bloomage BioTechnology. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Equity Ownership

Private equity firms hold a 66% stake in Bloomage BioTechnology. This suggests they can be influential in key policy decisions. 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 2 warning signs we’ve spotted with Bloomage BioTechnology .

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.

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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.