CECEP Techand Ecology&Environment Co.,Ltd.'s (SZSE:300197) market cap surged CN¥415m last week, retail investors who have a lot riding on the company were rewarded

Key Insights

• Significant control over CECEP Techand Ecology&EnvironmentLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 8 shareholders own 51% of the company
• Institutions own 20% of CECEP Techand Ecology&EnvironmentLtd

Every investor in CECEP Techand Ecology&Environment Co.,Ltd. (SZSE:300197) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are retail investors with 44% 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, retail investors collectively scored the highest last week as the company hit CN¥6.6b market cap following a 6.8% gain in the stock.

In the chart below, we zoom in on the different ownership groups of CECEP Techand Ecology&EnvironmentLtd.

Check out our latest analysis for CECEP Techand Ecology&EnvironmentLtd

What Does The Institutional Ownership Tell Us About CECEP Techand Ecology&EnvironmentLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that CECEP Techand Ecology&EnvironmentLtd 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. 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 CECEP Techand Ecology&EnvironmentLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in CECEP Techand Ecology&EnvironmentLtd. The company's largest shareholder is China Energy Conservation and Environmental Protection Group, with ownership of 25%. With 5.8% and 5.2% of the shares outstanding respectively, Shui Liu and CECEP Capital Holdings Limited are the second and third largest shareholders.

We did some more digging and found that 8 of the top shareholders account for roughly 51% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 CECEP Techand Ecology&EnvironmentLtd

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

We can see that insiders own shares in CECEP Techand Ecology&Environment Co.,Ltd.. It has a market capitalization of just CN¥6.6b, and insiders have CN¥382m worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

With a 44% ownership, the general public, mostly comprising of individual investors, have some degree of sway over CECEP Techand Ecology&EnvironmentLtd. 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 30%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 2 warning signs for CECEP Techand Ecology&EnvironmentLtd that you should be aware of before investing here.

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.