Key Insights

• The considerable ownership by individual investors in Sichuan Kexin Mechanical and Electrical EquipmentLtd indicates that they collectively have a greater say in management and business strategy
• The top 12 shareholders own 51% of the company
• 41% of Sichuan Kexin Mechanical and Electrical EquipmentLtd is held by insiders

If you want to know who really controls Sichuan Kexin Mechanical and Electrical Equipment Co.,Ltd (SZSE:300092), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 46% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While insiders who own 41% came under pressure after market cap dropped to CN¥3.2b last week,individual investors took the most losses.

In the chart below, we zoom in on the different ownership groups of Sichuan Kexin Mechanical and Electrical EquipmentLtd.

What Does The Institutional Ownership Tell Us About Sichuan Kexin Mechanical and Electrical EquipmentLtd?

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.

We can see that Sichuan Kexin Mechanical and Electrical EquipmentLtd does have institutional investors; and they hold a good portion of the company's stock. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Sichuan Kexin Mechanical and Electrical EquipmentLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Sichuan Kexin Mechanical and Electrical EquipmentLtd is not owned by hedge funds. The company's largest shareholder is Zhenhua Lin, with ownership of 16%. Meanwhile, the second and third largest shareholders, hold 15% and 10%, of the shares outstanding, respectively.

A closer look at our ownership figures suggests that the top 12 shareholders have a combined ownership of 51% implying that no single shareholder has a majority.

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. 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 Sichuan Kexin Mechanical and Electrical EquipmentLtd

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.

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.

It seems insiders own a significant proportion of Sichuan Kexin Mechanical and Electrical Equipment Co.,Ltd. It has a market capitalization of just CN¥3.2b, and insiders have CN¥1.3b worth of shares in their own names. 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

With a 46% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Sichuan Kexin Mechanical and Electrical EquipmentLtd. 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.