Key Insights

• Significant insider control over Bichamp Cutting Technology (Hunan) implies vested interests in company growth
• A total of 3 investors have a majority stake in the company with 51% ownership
• Institutional ownership in Bichamp Cutting Technology (Hunan) is 22%

Every investor in Bichamp Cutting Technology (Hunan) Co., Ltd. (SZSE:002843) should be aware of the most powerful shareholder groups. With 31% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by CN¥410m last week.

Let's delve deeper into each type of owner of Bichamp Cutting Technology (Hunan), beginning with the chart below.

What Does The Institutional Ownership Tell Us About Bichamp Cutting Technology (Hunan)?

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.

Bichamp Cutting Technology (Hunan) already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Bichamp Cutting Technology (Hunan)'s earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Bichamp Cutting Technology (Hunan). Looking at our data, we can see that the largest shareholder is the CEO Hong Fang with 24% of shares outstanding. For context, the second largest shareholder holds about 20% of the shares outstanding, followed by an ownership of 7.3% by the third-largest shareholder.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. 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 Bichamp Cutting Technology (Hunan)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 Bichamp Cutting Technology (Hunan) Co., Ltd.. Insiders have a CN¥989m stake in this CN¥3.2b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 25% stake in the company, and hence can't easily be ignored. 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.

Public Company Ownership

We can see that public companies hold 20% of the Bichamp Cutting Technology (Hunan) shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 4 warning signs for Bichamp Cutting Technology (Hunan) (1 doesn't sit too well with us) that you should be aware of.

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.