Guangzhou Anyka Microelectronics Co., Ltd.'s (SHSE:688620) market cap surged CN¥459m last week, private companies who have a lot riding on the company were rewarded

Key Insights

• Significant control over Guangzhou Anyka Microelectronics by private companies implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 8 shareholders
• 23% of Guangzhou Anyka Microelectronics is held by Institutions

If you want to know who really controls Guangzhou Anyka Microelectronics Co., Ltd. (SHSE:688620), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private companies with 37% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies were the biggest beneficiaries of last week’s 13% gain.

In the chart below, we zoom in on the different ownership groups of Guangzhou Anyka Microelectronics.

See our latest analysis for Guangzhou Anyka Microelectronics

What Does The Institutional Ownership Tell Us About Guangzhou Anyka Microelectronics?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

We can see that Guangzhou Anyka Microelectronics does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Guangzhou Anyka Microelectronics' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Guangzhou Anyka Microelectronics. Anyka Technologies Corp. is currently the company's largest shareholder with 16% of shares outstanding. Zhejiang Wuyi Kairuida Electronic Technology Co., Ltd. is the second largest shareholder owning 7.3% of common stock, and Primrose Capital Limited holds about 6.4% of the company stock. In addition, we found that Shengfa Hu, the CEO has 4.9% of the shares allocated to their name.

We did some more digging and found that 8 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 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Guangzhou Anyka Microelectronics

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

Shareholders would probably be interested to learn that insiders own shares in Guangzhou Anyka Microelectronics Co., Ltd.. It has a market capitalization of just CN¥4.1b, and insiders have CN¥201m worth of shares, in their own names. 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

With a 35% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Guangzhou Anyka Microelectronics. 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

Our data indicates that Private Companies hold 37%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Guangzhou Anyka Microelectronics better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.