The recent pullback must have dismayed Zhejiang Sanmei Chemical Industry Co.,Ltd. (SHSE:603379) insiders who own 58% of the company

Key Insights

• Significant insider control over Zhejiang Sanmei Chemical IndustryLtd implies vested interests in company growth
• 55% of the business is held by the top 2 shareholders
• Institutions own 10% of Zhejiang Sanmei Chemical IndustryLtd

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If you want to know who really controls Zhejiang Sanmei Chemical Industry Co.,Ltd. (SHSE:603379), 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 58% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders as a group endured the highest losses after market cap fell by CN¥1.1b.

Let's take a closer look to see what the different types of shareholders can tell us about Zhejiang Sanmei Chemical IndustryLtd.

See our latest analysis for Zhejiang Sanmei Chemical IndustryLtd

What Does The Institutional Ownership Tell Us About Zhejiang Sanmei Chemical IndustryLtd?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Zhejiang Sanmei Chemical IndustryLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Zhejiang Sanmei Chemical IndustryLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Zhejiang Sanmei Chemical IndustryLtd. The company's largest shareholder is Rongda Hu, with ownership of 38%. With 17% and 8.0% of the shares outstanding respectively, Qixiang Hu and Wuyi Sanmei Investment Co., Ltd. are the second and third largest shareholders. Qixiang Hu, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

To make our study more interesting, we found that the top 2 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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Zhejiang Sanmei Chemical IndustryLtd

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.

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 most recent data indicates that insiders own the majority of Zhejiang Sanmei Chemical Industry Co.,Ltd.. This means they can collectively make decisions for the company. That means insiders have a very meaningful CN¥14b stake in this CN¥24b business. Most would be pleased to see the board is investing alongside them. You may wish to discover if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 23% stake in Zhejiang Sanmei Chemical IndustryLtd. 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

It seems that Private Companies own 8.0%, of the Zhejiang Sanmei Chemical IndustryLtd 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Sanmei Chemical IndustryLtd better, we need to consider many other factors. Take risks for example - Zhejiang Sanmei Chemical IndustryLtd has 2 warning signs (and 1 which makes us a bit uncomfortable) we think 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.