Insiders with their considerable ownership were the key benefactors as Anhui Xinbo Aluminum Co., Ltd. (SZSE:003038) touches CN¥3.8b market cap

Key Insights

• Insiders appear to have a vested interest in Anhui Xinbo Aluminum's growth, as seen by their sizeable ownership
• 52% of the business is held by the top 7 shareholders
• Institutions own 21% of Anhui Xinbo Aluminum

To get a sense of who is truly in control of Anhui Xinbo Aluminum Co., Ltd. (SZSE:003038), it is important to understand the ownership structure of the business. With 45% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥546m last week.

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

See our latest analysis for Anhui Xinbo Aluminum

What Does The Institutional Ownership Tell Us About Anhui Xinbo Aluminum?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Anhui Xinbo Aluminum 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 Anhui Xinbo Aluminum's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Anhui Xinbo Aluminum. Kaijian Tang is currently the company's largest shareholder with 32% of shares outstanding. Anhui Addor Huicheng Equity Investment Management Enterprise is the second largest shareholder owning 4.2% of common stock, and Zhengpei Li holds about 3.7% of the company stock. Zhengpei Li, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors. Furthermore, CEO Weirong Chen is the owner of 2.2% of the company's shares.

We did some more digging and found that 7 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. 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 Anhui Xinbo Aluminum

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

It seems insiders own a significant proportion of Anhui Xinbo Aluminum Co., Ltd.. It has a market capitalization of just CN¥3.8b, and insiders have CN¥1.7b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 30% stake in the company, and hence can't easily be ignored. 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 3.6%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should learn about the 4 warning signs we've spotted with Anhui Xinbo Aluminum (including 2 which can't be ignored) .

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.