Zhejiang Entive Smart Kitchen Appliance Co., Ltd.'s (SZSE:300911) market cap dropped CN¥330m last week; Private companies bore the brunt

Key Insights

• Zhejiang Entive Smart Kitchen Appliance's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 3 shareholders own 52% of the company
• Institutional ownership in Zhejiang Entive Smart Kitchen Appliance is 12%

If you want to know who really controls Zhejiang Entive Smart Kitchen Appliance Co., Ltd. (SZSE:300911), then you'll have to look at the makeup of its share registry. With 53% stake, private companies possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, private companies endured the biggest losses as the stock fell by 10%.

Let's delve deeper into each type of owner of Zhejiang Entive Smart Kitchen Appliance, beginning with the chart below.

View our latest analysis for Zhejiang Entive Smart Kitchen Appliance

What Does The Institutional Ownership Tell Us About Zhejiang Entive Smart Kitchen Appliance?

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.

As you can see, institutional investors have a fair amount of stake in Zhejiang Entive Smart Kitchen Appliance. 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. 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 Zhejiang Entive Smart Kitchen Appliance'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 Zhejiang Entive Smart Kitchen Appliance. The company's largest shareholder is Zhejiang Entive Investment Management Co., Ltd., with ownership of 44%. The second and third largest shareholders are Shengzhou Yishun Investment Management Partnership Enterprise (Limited Partnership) and Shengzhou Yiwang Investment Management Partnership (Limited Partnership), with an equal amount of shares to their name at 3.7%. Furthermore, CEO Ji Sun is the owner of 3.0% of the company's shares.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Zhejiang Entive Smart Kitchen Appliance

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Shareholders would probably be interested to learn that insiders own shares in Zhejiang Entive Smart Kitchen Appliance Co., Ltd.. It has a market capitalization of just CN¥2.9b, and insiders have CN¥259m worth of shares, in their own names. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 26% stake in Zhejiang Entive Smart Kitchen Appliance. 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 53%, of the Zhejiang Entive Smart Kitchen Appliance 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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Zhejiang Entive Smart Kitchen Appliance (of which 1 is significant!) you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.