Shanghai Hugong Electric Group Co.,Ltd.'s (SHSE:603131) market cap rose CN¥388m last week; individual investors who hold 44% profited and so did insiders

Key Insights

• The considerable ownership by individual investors in Shanghai Hugong Electric GroupLtd indicates that they collectively have a greater say in management and business strategy
• 53% of the business is held by the top 4 shareholders
• Insiders own 42% of Shanghai Hugong Electric GroupLtd

A look at the shareholders of Shanghai Hugong Electric Group Co.,Ltd. (SHSE:603131) can tell us which group is most powerful. With 44% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 6.5% increase in the stock price last week, individual investors profited the most, but insiders who own 42% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of Shanghai Hugong Electric GroupLtd, beginning with the chart below.

See our latest analysis for Shanghai Hugong Electric GroupLtd

What Does The Institutional Ownership Tell Us About Shanghai Hugong Electric GroupLtd?

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.

Less than 5% of Shanghai Hugong Electric GroupLtd is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

Shanghai Hugong Electric GroupLtd is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Zhen Yu Shu with 21% of shares outstanding. For context, the second largest shareholder holds about 20% of the shares outstanding, followed by an ownership of 8.0% by the third-largest shareholder.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Shanghai Hugong Electric GroupLtd

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. 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.

Our most recent data indicates that insiders own a reasonable proportion of Shanghai Hugong Electric Group Co.,Ltd.. It has a market capitalization of just CN¥6.4b, and insiders have CN¥2.7b worth of shares in their own names. 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 44% stake in Shanghai Hugong Electric GroupLtd. 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

Our data indicates that Private Companies hold 12%, 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:

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. For example, we've discovered 1 warning sign for Shanghai Hugong Electric GroupLtd that you should be aware of before investing here.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.