Key Insights

• Significant control over Zhejiang Sanhua Intelligent ControlsLtd 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
• 24% of Zhejiang Sanhua Intelligent ControlsLtd is held by Institutions

To get a sense of who is truly in control of Zhejiang Sanhua Intelligent Controls Co.,Ltd (SZSE:002050), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Individual investors, on the other hand, account for 27% of the company's stockholders.

Let's delve deeper into each type of owner of Zhejiang Sanhua Intelligent ControlsLtd, beginning with the chart below.

See our latest analysis for Zhejiang Sanhua Intelligent ControlsLtd

What Does The Institutional Ownership Tell Us About Zhejiang Sanhua Intelligent ControlsLtd?

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.

As you can see, institutional investors have a fair amount of stake in Zhejiang Sanhua Intelligent ControlsLtd. 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 Zhejiang Sanhua Intelligent ControlsLtd, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Zhejiang Sanhua Intelligent ControlsLtd. Our data shows that Sanhua Holding Group Co., Ltd. is the largest shareholder with 27% of shares outstanding. For context, the second largest shareholder holds about 21% of the shares outstanding, followed by an ownership of 2.5% by the third-largest shareholder. Additionally, the company's CEO Yabo Zhang directly holds 1.1% of the total shares outstanding.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Zhejiang Sanhua Intelligent ControlsLtd

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.

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.

Shareholders would probably be interested to learn that insiders own shares in Zhejiang Sanhua Intelligent Controls Co.,Ltd. Insiders own CN¥931m worth of shares (at current prices). Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 27% stake in Zhejiang Sanhua Intelligent ControlsLtd. 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 49%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example - Zhejiang Sanhua Intelligent ControlsLtd has 2 warning signs (and 1 which is significant) we think you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.