Zhefu Holding Group Co., Ltd.'s (SZSE:002266) last week's 4.3% decline must have disappointed retail investors who have a significant stake

Key Insights

• The considerable ownership by retail investors in Zhefu Holding Group indicates that they collectively have a greater say in management and business strategy
• The top 3 shareholders own 51% of the company
• 29% of Zhefu Holding Group is held by insiders

To get a sense of who is truly in control of Zhefu Holding Group Co., Ltd. (SZSE:002266), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 37% to be precise, is retail investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders, who own 29% shares weren’t spared from last week’s CN¥775m market cap drop, retail investors as a group suffered the maximum losses

Let's delve deeper into each type of owner of Zhefu Holding Group, beginning with the chart below.

See our latest analysis for Zhefu Holding Group

What Does The Institutional Ownership Tell Us About Zhefu Holding Group?

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.

Institutions have a very small stake in Zhefu Holding Group. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Hedge funds don't have many shares in Zhefu Holding Group. Tonglu Yuantong Industrial Co., Ltd. is currently the largest shareholder, with 25% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 17% and 8.2%, of the shares outstanding, respectively. Yi Sun, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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 some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Zhefu Holding Group

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.

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 Zhefu Holding Group Co., Ltd.. It is very interesting to see that insiders have a meaningful CN¥5.0b stake in this CN¥17b business. 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, who are usually individual investors, hold a 37% stake in Zhefu Holding Group. 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

It seems that Private Companies own 29%, of the Zhefu Holding Group stock. 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:

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. For example, we've discovered 3 warning signs for Zhefu Holding Group that you should be aware of before investing here.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.