CEO Dayong Yu, Runa Smart Equipment Co., Ltd.'s (SZSE:301129) largest shareholder sees value of holdings go down 11% after recent drop

Key Insights

• Runa Smart Equipment's significant insider ownership suggests inherent interests in company's expansion
• The largest shareholder of the company is Dayong Yu with a 60% stake
• Institutional ownership in Runa Smart Equipment is 13%

If you want to know who really controls Runa Smart Equipment Co., Ltd. (SZSE:301129), 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 insiders with 68% 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, insiders as a group endured the highest losses after market cap fell by CN¥274m.

Let's delve deeper into each type of owner of Runa Smart Equipment, beginning with the chart below.

See our latest analysis for Runa Smart Equipment

What Does The Institutional Ownership Tell Us About Runa Smart Equipment?

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.

As you can see, institutional investors have a fair amount of stake in Runa Smart Equipment. 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. 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 Runa Smart Equipment's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Runa Smart Equipment. Looking at our data, we can see that the largest shareholder is the CEO Dayong Yu with 60% of shares outstanding. With such a huge stake, we infer that they have significant control of the future of the company. It's usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider with such skin in the game. Zhaojie Wang is the second largest shareholder owning 4.4% of common stock, and Zhonggeng Fund Management Co., Ltd. holds about 3.6% of the company stock. Interestingly, the second-largest shareholder, Zhaojie Wang is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

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. 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 Runa Smart Equipment

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 that insiders own more than half the Runa Smart Equipment Co., Ltd. stock. This gives them a lot of power. Given it has a market cap of CN¥2.3b, that means they have CN¥1.6b worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

With a 12% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Runa Smart Equipment. 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

We can see that Private Companies own 6.6%, of the shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Runa Smart Equipment better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 3 warning signs for Runa Smart Equipment (of which 2 shouldn't be ignored!) you should know about.

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.