Hangzhou Hikvision Digital Technology Co., Ltd.'s (SZSE:002415) largest shareholders are private companies with 48% ownership, individual investors own 27%

Key Insights

• Significant control over Hangzhou Hikvision Digital Technology by private companies implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 2 shareholders
• Insider ownership in Hangzhou Hikvision Digital Technology is 12%

If you want to know who really controls Hangzhou Hikvision Digital Technology Co., Ltd. (SZSE:002415), then you'll have to look at the makeup of its share registry. We can see that private companies own the lion's share in the company with 48% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Meanwhile, individual investors make up 27% of the company’s shareholders.

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

Check out our latest analysis for Hangzhou Hikvision Digital Technology

What Does The Institutional Ownership Tell Us About Hangzhou Hikvision Digital 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.

We can see that Hangzhou Hikvision Digital Technology 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. 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 Hikvision Digital Technology's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Hangzhou Hikvision Digital Technology. Looking at our data, we can see that the largest shareholder is China Electronics Technology Group Corporation with 41% of shares outstanding. With 10% and 4.8% of the shares outstanding respectively, Hongjia Gong and Hangzhou Weixun Equity Investment Partnership Enterprise (Limited Partnership) are the second and third largest shareholders. Additionally, the company's CEO Yangzhong Hu directly holds 1.7% of the total shares outstanding.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Hangzhou Hikvision Digital 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. 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 Hikvision Digital Technology Co., Ltd.. Insiders own CN¥37b worth of shares in the CN¥308b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public-- including retail investors -- own 27% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 48%, of the Hangzhou Hikvision Digital Technology stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Hangzhou Hikvision Digital Technology , and understanding them should be part of your investment process.

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.