Private companies among Sichuan Anning Iron and Titanium Co.,Ltd.'s (SZSE:002978) largest stockholders and were hit after last week's 3.2% price drop

Key Insights

• The considerable ownership by private companies in Sichuan Anning Iron and TitaniumLtd indicates that they collectively have a greater say in management and business strategy
• The top 2 shareholders own 76% of the company
• Insider ownership in Sichuan Anning Iron and TitaniumLtd is 40%

To get a sense of who is truly in control of Sichuan Anning Iron and Titanium Co.,Ltd. (SZSE:002978), it is important to understand the ownership structure of the business. We can see that private companies own the lion's share in the company with 42% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While the holdings of private companies took a hit after last week’s 3.2% price drop, insiders with their 40% also suffered.

In the chart below, we zoom in on the different ownership groups of Sichuan Anning Iron and TitaniumLtd.

See our latest analysis for Sichuan Anning Iron and TitaniumLtd

What Does The Institutional Ownership Tell Us About Sichuan Anning Iron and TitaniumLtd?

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.

Institutions have a very small stake in Sichuan Anning Iron and TitaniumLtd. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Sichuan Anning Iron and TitaniumLtd. Our data shows that Chengdu Zidong Investment Co., Ltd. is the largest shareholder with 42% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 34% and 6.5%, of the shares outstanding, respectively.

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 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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Sichuan Anning Iron and TitaniumLtd

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.

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.

Our information suggests that insiders maintain a significant holding in Sichuan Anning Iron and Titanium Co.,Ltd.. It is very interesting to see that insiders have a meaningful CN¥5.2b stake in this CN¥13b business. 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 15% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Sichuan Anning Iron and TitaniumLtd. 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 42%, of the Sichuan Anning Iron and TitaniumLtd 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Sichuan Anning Iron and TitaniumLtd has 2 warning signs (and 1 which is concerning) we think 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.