Private companies are Zhejiang Sanhua Intelligent Controls Co.,Ltd's (SZSE:002050) biggest owners and were hit after market cap dropped CN¥15b

Key Insights

• Zhejiang Sanhua Intelligent ControlsLtd's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• 51% of the business is held by the top 8 shareholders
• 19% of Zhejiang Sanhua Intelligent ControlsLtd is held by Institutions

A look at the shareholders of Zhejiang Sanhua Intelligent Controls Co.,Ltd (SZSE:002050) can tell us which group is most powerful. The group holding the most number of shares in the company, around 44% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies as a group endured the highest losses last week after market cap fell by CN¥15b.

Let's delve deeper into each type of owner of Zhejiang Sanhua Intelligent ControlsLtd, beginning with the chart below.

Check out our latest analysis for Zhejiang Sanhua Intelligent ControlsLtd

What Does The Institutional Ownership Tell Us About Zhejiang Sanhua Intelligent ControlsLtd?

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 Zhejiang Sanhua Intelligent ControlsLtd 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. 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 Zhejiang Sanhua Intelligent ControlsLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Zhejiang Sanhua Intelligent ControlsLtd. Sanhua Holding Group Co., Ltd. is currently the largest shareholder, with 26% of shares outstanding. Zhejiang Sanhua Lvneng Industrial Group Co., Ltd. is the second largest shareholder owning 19% of common stock, and Guotai Asset Management Company Limited holds about 1.4% of the company stock. In addition, we found that Yabo Zhang, the CEO has 1.0% of the shares allocated to their name.

On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Zhejiang Sanhua Intelligent ControlsLtd

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. 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.

Shareholders would probably be interested to learn that insiders own shares in Zhejiang Sanhua Intelligent Controls Co.,Ltd. It is a very large company, and board members collectively own CN¥1.2b worth of shares (at current prices). Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 36% stake in the company, and hence can't easily be ignored. 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 Company Ownership

We can see that Private Companies own 44%, 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 Sanhua Intelligent ControlsLtd better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with Zhejiang Sanhua Intelligent ControlsLtd .

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.