Hangzhou Gaoxin Materials Technology Co., Ltd.'s (SZSE:300478) market cap surged CN¥366m last week, retail investors who have a lot riding on the company were rewarded

Key Insights

• The considerable ownership by retail investors in Hangzhou Gaoxin Materials Technology indicates that they collectively have a greater say in management and business strategy
• A total of 10 investors have a majority stake in the company with 51% ownership
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of Hangzhou Gaoxin Materials Technology Co., Ltd. (SZSE:300478), it is important to understand the ownership structure of the business. 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.

As a result, retail investors collectively scored the highest last week as the company hit CN¥1.5b market cap following a 31% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Hangzhou Gaoxin Materials Technology.

Check out our latest analysis for Hangzhou Gaoxin Materials Technology

What Does The Institutional Ownership Tell Us About Hangzhou Gaoxin Materials Technology?

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.

We can see that Hangzhou Gaoxin Materials Technology does have institutional investors; and they hold a good portion of the company's stock. 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 Hangzhou Gaoxin Materials Technology's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Hangzhou Gaoxin Materials Technology. The company's largest shareholder is Zhejiang Donghang Holding Group Co., Ltd., with ownership of 22%. With 5.7% and 5.0% of the shares outstanding respectively, Liaoning Zhongke Consulting Management Center (Limited Partnership) and Junkun Lv are the second and third largest shareholders.

We also observed that the top 10 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Hangzhou Gaoxin Materials Technology

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. 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.

We can see that insiders own shares in Hangzhou Gaoxin Materials Technology Co., Ltd.. In their own names, insiders own CN¥150m worth of stock in the CN¥1.5b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 48% stake in Hangzhou Gaoxin Materials Technology. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

It seems that Private Companies own 35%, of the Hangzhou Gaoxin Materials Technology 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Hangzhou Gaoxin Materials Technology better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Hangzhou Gaoxin Materials Technology you should be aware of.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.