Guizhou Panjiang Refined Coal Co.,Ltd.'s (SHSE:600395) last week's 3.8% decline must have disappointed private companies who have a significant stake

Key Insights

• The considerable ownership by private companies in Guizhou Panjiang Refined CoalLtd indicates that they collectively have a greater say in management and business strategy
• 53% of the business is held by the top 3 shareholders
• Institutions own 19% of Guizhou Panjiang Refined CoalLtd

If you want to know who really controls Guizhou Panjiang Refined Coal Co.,Ltd. (SHSE:600395), 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 52% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, private companies endured the biggest losses as the stock fell by 3.8%.

In the chart below, we zoom in on the different ownership groups of Guizhou Panjiang Refined CoalLtd.

View our latest analysis for Guizhou Panjiang Refined CoalLtd

What Does The Institutional Ownership Tell Us About Guizhou Panjiang Refined CoalLtd?

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 Guizhou Panjiang Refined CoalLtd does have institutional investors; and they hold a good portion of the company's stock. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Guizhou Panjiang Refined CoalLtd's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Guizhou Panjiang Refined CoalLtd. Guizhou Energy Group Corporation Limited is currently the largest shareholder, with 45% of shares outstanding. The second and third largest shareholders are Guixin Ruihe Venture Capital Management Co., Ltd. and Guizhou Qiansheng State-Owned Assets Management Co., Ltd., with an equal amount of shares to their name at 3.9%.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Guizhou Panjiang Refined CoalLtd

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

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.

Our data cannot confirm that board members are holding shares personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

With a 29% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guizhou Panjiang Refined CoalLtd. 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

We can see that Private Companies own 52%, of the shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Guizhou Panjiang Refined CoalLtd better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Guizhou Panjiang Refined CoalLtd , and understanding them should be part of your investment process.

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.