Key Insights

• Hunan Kaimeite Gases' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 50% of the business is held by the top 3 shareholders
• Institutional ownership in Hunan Kaimeite Gases is 18%

To get a sense of who is truly in control of Hunan Kaimeite Gases Co., Ltd. (SZSE:002549), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 43% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors collectively scored the highest last week as the company hit CN¥4.1b market cap following a 18% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Hunan Kaimeite Gases.

What Does The Institutional Ownership Tell Us About Hunan Kaimeite Gases?

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.

Hunan Kaimeite Gases 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. 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 Hunan Kaimeite Gases' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Hunan Kaimeite Gases. Haoxun Scientific & Technological Co., Ltd. is currently the company's largest shareholder with 37% of shares outstanding. Hunan Chasing Asset Management Co.,Ltd. is the second largest shareholder owning 10% of common stock, and Hunan Chasing Fund Management Co., Ltd holds about 2.3% of the company stock.

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 50% stake.

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 Hunan Kaimeite Gases

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 most recent data indicates that insiders own less than 1% of Hunan Kaimeite Gases Co., Ltd.. But they may have an indirect interest through a corporate structure that we haven't picked up on. It seems the board members have no more than CN¥40m worth of shares in the CN¥4.1b company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a 43% stake in Hunan Kaimeite Gases. 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

It seems that Private Companies own 38%, of the Hunan Kaimeite Gases stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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. For example, we've discovered 1 warning sign for Hunan Kaimeite Gases that you should be aware of before investing here.

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.