While individual investors own 32% of Zhejiang NHU Company Ltd. (SZSE:002001), private companies are its largest shareholders with 51% ownership

Key Insights

• Significant control over Zhejiang NHU by private companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is NHU Holding Group Co.,Ltd with a 50% stake
• Institutions own 15% of Zhejiang NHU

If you want to know who really controls Zhejiang NHU Company Ltd. (SZSE:002001), 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 51% to be precise, is private companies. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Meanwhile, individual investors make up 32% of the company’s shareholders.

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

Check out our latest analysis for Zhejiang NHU

What Does The Institutional Ownership Tell Us About Zhejiang NHU?

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.

Zhejiang NHU already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Zhejiang NHU, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Zhejiang NHU. The company's largest shareholder is NHU Holding Group Co.,Ltd, with ownership of 50%. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 3.7% of the shares outstanding, followed by an ownership of 2.3% by the third-largest shareholder.

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 Zhejiang NHU

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 some shares in Zhejiang NHU Company Ltd.. It is a very large company, and board members collectively own CN¥932m worth of shares (at current prices). Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 32% stake in Zhejiang NHU. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 51%, of the Zhejiang NHU 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:

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 1 warning sign for Zhejiang NHU that you should be aware of before investing here.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com