CEO Yutian Wang, HONG RI DA Technology Company Limited's (SZSE:301285) largest shareholder sees value of holdings go down 6.3% after recent drop

Key Insights

• HONG RI DA Technology's significant insider ownership suggests inherent interests in company's expansion
• A total of 2 investors have a majority stake in the company with 56% ownership
• 12% of HONG RI DA Technology is held by Institutions

A look at the shareholders of HONG RI DA Technology Company Limited (SZSE:301285) can tell us which group is most powerful. The group holding the most number of shares in the company, around 50% to be precise, is individual insiders. 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¥383m.

In the chart below, we zoom in on the different ownership groups of HONG RI DA Technology.

Check out our latest analysis for HONG RI DA Technology

What Does The Institutional Ownership Tell Us About HONG RI DA Technology?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

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

Hedge funds don't have many shares in HONG RI DA Technology. With a 45% stake, CEO Yutian Wang is the largest shareholder. Meanwhile, the second and third largest shareholders, hold 11% and 3.7%, of the shares outstanding, respectively. Interestingly, the third-largest shareholder, Zhangqin Shi is also a Member of the Board of Directors, again, indicating strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 56% stake.

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. 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 HONG RI DA Technology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Our information suggests that insiders maintain a significant holding in HONG RI DA Technology Company Limited. Insiders have a CN¥2.8b stake in this CN¥5.7b business. 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-- including retail investors -- own 25% stake in the company, and hence can't easily be ignored. 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

Our data indicates that Private Companies hold 14%, of the company's shares. 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. Case in point: We've spotted 2 warning signs for HONG RI DA Technology 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.