Retail investors who hold 53% of RAISECOM TECHNOLOGY CO.,Ltd. (SHSE:603803) gained 38%, insiders profited as well

Key Insights

• The considerable ownership by retail investors in RAISECOM TECHNOLOGYLtd indicates that they collectively have a greater say in management and business strategy
• The top 25 shareholders own 47% of the company
• Insiders own 45% of RAISECOM TECHNOLOGYLtd

A look at the shareholders of RAISECOM TECHNOLOGY CO.,Ltd. (SHSE:603803) can tell us which group is most powerful. With 53% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Retail investors gained the most after market cap touched CN¥5.7b last week, while insiders who own 45% also benefitted.

Let's delve deeper into each type of owner of RAISECOM TECHNOLOGYLtd, beginning with the chart below.

Check out our latest analysis for RAISECOM TECHNOLOGYLtd

What Does The Lack Of Institutional Ownership Tell Us About RAISECOM TECHNOLOGYLtd?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. RAISECOM TECHNOLOGYLtd's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

RAISECOM TECHNOLOGYLtd is not owned by hedge funds. Yue Jie Li is currently the largest shareholder, with 9.0% of shares outstanding. The second and third largest shareholders are Jian Hong Ren and Chun Cheng Zhu, with an equal amount of shares to their name at 9.0%.

Our studies suggest that the top 25 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of RAISECOM TECHNOLOGYLtd

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.

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.

It seems insiders own a significant proportion of RAISECOM TECHNOLOGY CO.,Ltd.. Insiders own CN¥2.6b worth of shares in the CN¥5.7b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 53% stake in RAISECOM TECHNOLOGYLtd, suggesting it is a fairly popular stock. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

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. For instance, we've identified 2 warning signs for RAISECOM TECHNOLOGYLtd (1 is potentially serious) that you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.