Private companies in Zhejiang Reclaim Construction Group Co., Ltd. (SZSE:002586) are its biggest bettors, and their bets paid off as stock gained 10% last week

Key Insights

• Significant control over Zhejiang Reclaim Construction Group by private companies implies that the general public has more power to influence management and governance-related decisions
• A total of 7 investors have a majority stake in the company with 50% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

A look at the shareholders of Zhejiang Reclaim Construction Group Co., Ltd. (SZSE:002586) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 49% ownership. 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 companies were the biggest beneficiaries of last week’s 10% gain.

Let's delve deeper into each type of owner of Zhejiang Reclaim Construction Group, beginning with the chart below.

See our latest analysis for Zhejiang Reclaim Construction Group

What Does The Lack Of Institutional Ownership Tell Us About Zhejiang Reclaim Construction Group?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Zhejiang Reclaim Construction Group, for yourself, below.

Hedge funds don't have many shares in Zhejiang Reclaim Construction Group. Our data shows that Hangzhou Guangyao Zhixin Zhongyang Equity Investment Partnership Enterprise (Limited Partnership) is the largest shareholder with 15% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 15% and 11%, of the shares outstanding, respectively.

We did some more digging and found that 7 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. 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 Reclaim Construction Group

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can see that insiders own shares in Zhejiang Reclaim Construction Group Co., Ltd.. In their own names, insiders own CN¥89m worth of stock in the CN¥1.8b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Zhejiang Reclaim Construction Group. 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

It seems that Private Companies own 49%, of the Zhejiang Reclaim Construction Group stock. 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. To that end, you should be aware of the 1 warning sign we've spotted with Zhejiang Reclaim Construction Group .

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.