Individual investors among Hainan Drinda New Energy Technology Co., Ltd.'s (SZSE:002865) largest shareholders, saw gain in holdings value after stock jumped 17% last week

Key Insights

• Significant control over Hainan Drinda New Energy Technology by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 11 shareholders own 50% of the company
• Institutions own 13% of Hainan Drinda New Energy Technology

If you want to know who really controls Hainan Drinda New Energy Technology Co., Ltd. (SZSE:002865), 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 individual investors with 44% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, individual investors collectively scored the highest last week as the company hit CN¥9.6b market cap following a 17% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Hainan Drinda New Energy Technology.

See our latest analysis for Hainan Drinda New Energy Technology

What Does The Institutional Ownership Tell Us About Hainan Drinda New Energy Technology?

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.

Hainan Drinda New Energy Technology already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Hainan Drinda New Energy Technology's historic earnings and revenue below, but keep in mind there's always more to the story.

Hainan Drinda New Energy Technology is not owned by hedge funds. The company's largest shareholder is Hainan Yang Family Investment Co., Ltd., with ownership of 20%. Shangrao Innovation Development Industry Investment Group Co., Ltd. is the second largest shareholder owning 9.8% of common stock, and Xianze Su holds about 7.2% of the company stock.

After doing some more digging, we found that the top 11 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

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. 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 Hainan Drinda New Energy 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Shareholders would probably be interested to learn that insiders own shares in Hainan Drinda New Energy Technology Co., Ltd.. This is a big company, so it is good to see this level of alignment. Insiders own CN¥924m worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 44% stake in Hainan Drinda New Energy Technology. 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

It seems that Private Companies own 34%, of the Hainan Drinda New Energy Technology stock. 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:

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. Be aware that Hainan Drinda New Energy Technology is showing 5 warning signs in our investment analysis , and 1 of those is concerning...

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com