Key Insights

• Significant control over Jiangxi Black Cat Carbon BlackLtd by private companies implies that the general public has more power to influence management and governance-related decisions
• A total of 3 investors have a majority stake in the company with 51% ownership
• 26% of Jiangxi Black Cat Carbon BlackLtd is held by Institutions

To get a sense of who is truly in control of Jiangxi Black Cat Carbon Black Inc.,Ltd (SZSE:002068), it is important to understand the ownership structure of the business. We can see that private companies own the lion's share in the company with 34% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, private companies benefitted the most after the company's market cap rose by CN¥400m last week.

In the chart below, we zoom in on the different ownership groups of Jiangxi Black Cat Carbon BlackLtd.

What Does The Institutional Ownership Tell Us About Jiangxi Black Cat Carbon BlackLtd?

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 Jiangxi Black Cat Carbon BlackLtd. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Jiangxi Black Cat Carbon BlackLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Jiangxi Black Cat Carbon BlackLtd. Jingde Black Cat Group Co., Ltd. is currently the company's largest shareholder with 34% of shares outstanding. With 11% and 6.0% of the shares outstanding respectively, Jiangxi Jinggangshan Beiyuan Venture Capital Management Co., Ltd. and Guotai Asset Management Company Limited are the second and third largest shareholders.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 Jiangxi Black Cat Carbon BlackLtd

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 most recent data indicates that insiders own less than 1% of Jiangxi Black Cat Carbon Black Inc.,Ltd. However, it's possible that insiders might have an indirect interest through a more complex structure. It appears that the board holds about CN¥14m worth of stock. This compares to a market capitalization of CN¥5.4b. Many tend to prefer to see a board with bigger shareholdings. A good next step might be to take a look at this free summary of insider buying and selling.

General Public Ownership

The general public, who are usually individual investors, hold a 29% stake in Jiangxi Black Cat Carbon BlackLtd. 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 11%, private equity firms could influence the Jiangxi Black Cat Carbon BlackLtd board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Private Company Ownership

It seems that Private Companies own 34%, of the Jiangxi Black Cat Carbon BlackLtd 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 risks, for instance. Every company has them, and we've spotted 1 warning sign for Jiangxi Black Cat Carbon BlackLtd 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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com