Retail investors among Hangzhou Hirisun Technology Incorporated's (SZSE:300277) largest shareholders, saw gain in holdings value after stock jumped 11% last week

Key Insights

• Significant control over Hangzhou Hirisun Technology by retail investors implies that the general public has more power to influence management and governance-related decisions
• 49% of the business is held by the top 15 shareholders
• 12% of Hangzhou Hirisun Technology is held by insiders

To get a sense of who is truly in control of Hangzhou Hirisun Technology Incorporated (SZSE:300277), it is important to understand the ownership structure of the business. With 51% stake, retail investors 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).

As a result, retail investors collectively scored the highest last week as the company hit CN¥3.5b market cap following a 11% gain in the stock.

Let's delve deeper into each type of owner of Hangzhou Hirisun Technology, beginning with the chart below.

Check out our latest analysis for Hangzhou Hirisun Technology

What Does The Institutional Ownership Tell Us About Hangzhou Hirisun 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.

Hangzhou Hirisun Technology 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. 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 Hangzhou Hirisun Technology's historic earnings and revenue below, but keep in mind there's always more to the story.

Hangzhou Hirisun Technology is not owned by hedge funds. Hangzhou State-Owned Capital Investment and Operation Co., Ltd. is currently the company's largest shareholder with 30% of shares outstanding. Biao Kong is the second largest shareholder owning 3.7% of common stock, and Feng Zhang holds about 3.7% of the company stock.

On studying our ownership data, we found that 15 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Hangzhou Hirisun Technology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 Hangzhou Hirisun Technology Incorporated. Insiders have a CN¥421m stake in this CN¥3.5b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public -- including retail investors -- own 51% of Hangzhou Hirisun Technology. This level of ownership gives investors from the wider public some power to sway key policy decisions such as board composition, executive compensation, and the dividend payout ratio.

Private Equity Ownership

With an ownership of 30%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

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. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Hangzhou Hirisun Technology (of which 1 shouldn't be ignored!) you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.