Key Insights

• Significant control over Jiangsu HHCK Advanced MaterialsLtd by retail investors implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 8 shareholders
• 33% of Jiangsu HHCK Advanced MaterialsLtd is held by insiders

To get a sense of who is truly in control of Jiangsu HHCK Advanced Materials Co.,Ltd (SHSE:688535), it is important to understand the ownership structure of the business. We can see that retail investors own the lion's share in the company with 35% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 7.0% increase in the stock price last week, retail investors profited the most, but insiders who own 33% stock also stood to gain from the increase.

Let's take a closer look to see what the different types of shareholders can tell us about Jiangsu HHCK Advanced MaterialsLtd.

What Does The Institutional Ownership Tell Us About Jiangsu HHCK Advanced MaterialsLtd?

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.

Jiangsu HHCK Advanced MaterialsLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Jiangsu HHCK Advanced MaterialsLtd, (below). Of course, keep in mind that there are other factors to consider, too.

Jiangsu HHCK Advanced MaterialsLtd is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Jianglong Han with 14% of shares outstanding. With 13% and 6.7% of the shares outstanding respectively, Lianyungang Deyufeng Investment Partnership Enterprise (Limited Partnership) and Senmao Yang are the second and third largest shareholders.

On further inspection, we found that more than half the company's shares are owned by the top 8 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Jiangsu HHCK Advanced MaterialsLtd

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

Our information suggests that insiders maintain a significant holding in Jiangsu HHCK Advanced Materials Co.,Ltd. Insiders have a CN¥1.9b 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, who are usually individual investors, hold a 35% stake in Jiangsu HHCK Advanced MaterialsLtd. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 13%, 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.

Public Company Ownership

Public companies currently own 4.0% of Jiangsu HHCK Advanced MaterialsLtd stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Jiangsu HHCK Advanced MaterialsLtd better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Jiangsu HHCK Advanced MaterialsLtd 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.

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