Retail investors are Zhejiang Tengen Electrics Co.,Ltd.'s (SHSE:605066) biggest owners and were hit after market cap dropped CN¥443m

Key Insights

• The considerable ownership by retail investors in Zhejiang Tengen ElectricsLtd indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 50% of the company
• 15% of Zhejiang Tengen ElectricsLtd is held by insiders

A look at the shareholders of Zhejiang Tengen Electrics Co.,Ltd. (SHSE:605066) can tell us which group is most powerful. We can see that retail investors own the lion's share in the company with 39% ownership. 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 as a group endured the highest losses last week after market cap fell by CN¥443m.

Let's take a closer look to see what the different types of shareholders can tell us about Zhejiang Tengen ElectricsLtd.

Check out our latest analysis for Zhejiang Tengen ElectricsLtd

What Does The Institutional Ownership Tell Us About Zhejiang Tengen ElectricsLtd?

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.

Zhejiang Tengen ElectricsLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Zhejiang Tengen ElectricsLtd, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Zhejiang Tengen ElectricsLtd. Tengen Group Co., Ltd. is currently the largest shareholder, with 24% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 16% and 1.0%, of the shares outstanding, respectively. Tianle Gao, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

A closer look at our ownership figures suggests that the top 25 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Zhejiang Tengen ElectricsLtd

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

It seems insiders own a significant proportion of Zhejiang Tengen Electrics Co.,Ltd.. Insiders have a CN¥405m stake in this CN¥2.7b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 39% stake in Zhejiang Tengen ElectricsLtd. 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

We can see that Private Companies own 20%, of the shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Tengen ElectricsLtd better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with Zhejiang Tengen ElectricsLtd (including 1 which can't be ignored) .

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.