While private companies own 29% of Guangdong Hongda Holdings Group Co., Ltd. (SZSE:002683), retail investors are its largest shareholders with 48% ownership

Key Insights

• Guangdong Hongda Holdings Group's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 22 shareholders own 50% of the company
• 16% of Guangdong Hongda Holdings Group is held by insiders

A look at the shareholders of Guangdong Hongda Holdings Group Co., Ltd. (SZSE:002683) can tell us which group is most powerful. The group holding the most number of shares in the company, around 48% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Meanwhile, private companies make up 29% of the company’s shareholders.

Let's take a closer look to see what the different types of shareholders can tell us about Guangdong Hongda Holdings Group.

See our latest analysis for Guangdong Hongda Holdings Group

What Does The Institutional Ownership Tell Us About Guangdong Hongda Holdings Group?

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.

Guangdong Hongda Holdings Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Guangdong Hongda Holdings Group's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Guangdong Hongda Holdings Group. Looking at our data, we can see that the largest shareholder is Guangdong Environmental Protection Group Co.,Ltd. with 25% of shares outstanding. In comparison, the second and third largest shareholders hold about 5.9% and 4.8% of the stock.

A closer look at our ownership figures suggests that the top 22 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Guangdong Hongda Holdings Group

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.

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.

It seems insiders own a significant proportion of Guangdong Hongda Holdings Group Co., Ltd.. Insiders own CN¥2.5b worth of shares in the CN¥16b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 48% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guangdong Hongda Holdings Group. 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

Our data indicates that Private Companies hold 29%, of the company's shares. 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. Take risks for example - Guangdong Hongda Holdings Group has 1 warning sign we think you should be aware of.

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.