Sichuan Huati Lighting Technology Co.,Ltd.'s (SHSE:603679) market cap rose CN¥204m last week; retail investors who hold 51% profited and so did insiders

Key Insights

• The considerable ownership by retail investors in Sichuan Huati Lighting TechnologyLtd indicates that they collectively have a greater say in management and business strategy
• The top 8 shareholders own 49% of the company
• Insider ownership in Sichuan Huati Lighting TechnologyLtd is 38%

To get a sense of who is truly in control of Sichuan Huati Lighting Technology Co.,Ltd. (SHSE:603679), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 51% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Retail investors gained the most after market cap touched CN¥2.2b last week, while insiders who own 38% also benefitted.

Let's take a closer look to see what the different types of shareholders can tell us about Sichuan Huati Lighting TechnologyLtd.

View our latest analysis for Sichuan Huati Lighting TechnologyLtd

What Does The Institutional Ownership Tell Us About Sichuan Huati Lighting TechnologyLtd?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Sichuan Huati Lighting TechnologyLtd does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Sichuan Huati Lighting TechnologyLtd's earnings history below. Of course, the future is what really matters.

Sichuan Huati Lighting TechnologyLtd is not owned by hedge funds. Yu Xiang Liang is currently the company's largest shareholder with 21% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 15% and 5.7%, of the shares outstanding, respectively.

A deeper look at our ownership data shows that the top 8 shareholders collectively hold less than half of the register, suggesting a large group of small holders where no single shareholder has a majority.

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

Insider Ownership Of Sichuan Huati Lighting TechnologyLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

It seems insiders own a significant proportion of Sichuan Huati Lighting Technology Co.,Ltd.. Insiders own CN¥840m worth of shares in the CN¥2.2b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 51% of Sichuan Huati Lighting TechnologyLtd. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Company Ownership

It seems that Private Companies own 4.4%, of the Sichuan Huati Lighting TechnologyLtd 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. Consider risks, for instance. Every company has them, and we've spotted 2 warning signs for Sichuan Huati Lighting TechnologyLtd you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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.