Key Insights

• Significant control over Zhejiang Jingsheng Mechanical & Electrical by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 50% of the company
• Institutions own 19% of Zhejiang Jingsheng Mechanical & Electrical

If you want to know who really controls Zhejiang Jingsheng Mechanical & Electrical Co., Ltd. (SZSE:300316), then you'll have to look at the makeup of its share registry. With 47% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, private companies as a group endured the highest losses last week after market cap fell by CN¥1.4b.

In the chart below, we zoom in on the different ownership groups of Zhejiang Jingsheng Mechanical & Electrical.

What Does The Institutional Ownership Tell Us About Zhejiang Jingsheng Mechanical & Electrical?

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.

Zhejiang Jingsheng Mechanical & Electrical already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Jingsheng Mechanical & Electrical, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Zhejiang Jingsheng Mechanical & Electrical. Shangyu JinLun Investment Management Consulting Co., Ltd. is currently the company's largest shareholder with 47% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 2.9% and 2.7%, of the shares outstanding, respectively. Jianwei Cao, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board. In addition, we found that Jun He, the CEO has 0.6% of the shares allocated to their name.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 Jingsheng Mechanical & Electrical

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 some shares in Zhejiang Jingsheng Mechanical & Electrical Co., Ltd.. The insiders have a meaningful stake worth CN¥3.0b. Most would see this as a real positive. Most would say this shows 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 25% stake in Zhejiang Jingsheng Mechanical & Electrical. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 47%, 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.

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 for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Zhejiang Jingsheng Mechanical & Electrical (at least 1 which shouldn't be ignored) , and understanding them should be part of your investment process.

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.