Key Insights

• Significant control over Suzhou HYC TechnologyLtd by private equity firms implies that the general public has more power to influence management and governance-related decisions
• 52% of the company is held by a single shareholder (Suzhou Yuanhua Chuangxing Investment Management Co., Ltd.)
• 15% of Suzhou HYC TechnologyLtd is held by insiders

To get a sense of who is truly in control of Suzhou HYC Technology Co.,Ltd. (SHSE:688001), it is important to understand the ownership structure of the business. We can see that private equity firms own the lion's share in the company with 52% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, private equity firms endured the biggest losses as the stock fell by 5.9%.

In the chart below, we zoom in on the different ownership groups of Suzhou HYC TechnologyLtd.

What Does The Institutional Ownership Tell Us About Suzhou HYC TechnologyLtd?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Less than 5% of Suzhou HYC TechnologyLtd is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

Hedge funds don't have many shares in Suzhou HYC TechnologyLtd. The company's largest shareholder is Suzhou Yuanhua Chuangxing Investment Management Co., Ltd., with ownership of 52%. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Wenyuan Chen is the second largest shareholder owning 13% of common stock, and Suzhou Yuanfen Enterprise Management Partnership Enterprise (Limited Partnership) holds about 7.2% of the company stock. Wenyuan Chen, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Suzhou HYC TechnologyLtd

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.

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 Suzhou HYC Technology Co.,Ltd.. It is very interesting to see that insiders have a meaningful CN¥1.4b stake in this CN¥9.3b business. 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

The general public, who are usually individual investors, hold a 16% stake in Suzhou HYC TechnologyLtd. 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 Equity Ownership

With a stake of 52%, private equity firms could influence the Suzhou HYC TechnologyLtd board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

It seems that Private Companies own 14%, of the Suzhou HYC TechnologyLtd 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:

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 Suzhou HYC TechnologyLtd that you should be aware of.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.