Key Insights

• Zhejiang Cayi Vacuum Container's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• 56% of the business is held by the top 2 shareholders
• Insider ownership in Zhejiang Cayi Vacuum Container is 17%

To get a sense of who is truly in control of Zhejiang Cayi Vacuum Container Co., Ltd. (SZSE:301004), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 56% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

While insiders, who own 17% shares weren't spared from last week's CN¥592m market cap drop, private companies as a group suffered the maximum losses

Let's delve deeper into each type of owner of Zhejiang Cayi Vacuum Container, beginning with the chart below.

What Does The Institutional Ownership Tell Us About Zhejiang Cayi Vacuum Container?

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 Cayi Vacuum Container. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Cayi Vacuum Container, (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 Cayi Vacuum Container. Looking at our data, we can see that the largest shareholder is Zhejiang Jiashao Yunhua Investment Management Co., Ltd. with 47% of shares outstanding. With 9.0% and 8.2% of the shares outstanding respectively, Wuyi Jiajin Investment Management Partnership Enterprise (L.P.) and Xinghua Qi are the second and third largest shareholders. Xinghua Qi, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Zhejiang Cayi Vacuum Container

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own a reasonable proportion of Zhejiang Cayi Vacuum Container Co., Ltd.. Insiders own CN¥1.4b worth of shares in the CN¥8.3b company. That's quite meaningful. 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 12% stake in Zhejiang Cayi Vacuum Container. 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

Our data indicates that Private Companies hold 56%, of the company's shares. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Zhejiang Cayi Vacuum Container better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Zhejiang Cayi Vacuum Container you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

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