Hwa Create Corporation (SZSE:300045) most popular amongst individual investors who own 59%, insiders hold 35%

Key Insights

• Significant control over Hwa Create by individual investors implies that the general public has more power to influence management and governance-related decisions
• 41% of the business is held by the top 25 shareholders
• Insider ownership in Hwa Create is 35%

If you want to know who really controls Hwa Create Corporation (SZSE:300045), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 59% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).

Meanwhile, individual insiders make up 35% of the company’s shareholders. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders.

Let's delve deeper into each type of owner of Hwa Create, beginning with the chart below.

View our latest analysis for Hwa Create

What Does The Institutional Ownership Tell Us About Hwa Create?

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.

As you can see, institutional investors have a fair amount of stake in Hwa Create. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Hwa Create's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Hwa Create. Xiaoli Gao is currently the company's largest shareholder with 16% of shares outstanding. Qi Wang is the second largest shareholder owning 13% of common stock, and Yunhong Xiong holds about 4.4% of the company stock.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Hwa Create

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our most recent data indicates that insiders own a reasonable proportion of Hwa Create Corporation. It has a market capitalization of just CN¥16b, and insiders have CN¥5.7b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 59% of Hwa Create shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

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. Be aware that Hwa Create is showing 1 warning sign in our investment analysis , you should know about...

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.