Key Insights

• Significant control over Hangzhou Robam Appliances by private companies implies that the general public has more power to influence management and governance-related decisions
• 52% of the business is held by the top 2 shareholders
• Institutions own 18% of Hangzhou Robam Appliances

To get a sense of who is truly in control of Hangzhou Robam Appliances Co., Ltd. (SZSE:002508), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private companies with 51% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, private companies benefitted the most after the company's market cap rose by CN¥746m last week.

In the chart below, we zoom in on the different ownership groups of Hangzhou Robam Appliances.

What Does The Institutional Ownership Tell Us About Hangzhou Robam Appliances?

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.

We can see that Hangzhou Robam Appliances does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Hangzhou Robam Appliances, (below). Of course, keep in mind that there are other factors to consider, too.

Hangzhou Robam Appliances is not owned by hedge funds. Our data shows that Hangzhou Robam Industrial Group Co., Ltd. is the largest shareholder with 50% of shares outstanding. In comparison, the second and third largest shareholders hold about 1.8% and 1.6% of the stock.

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.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Hangzhou Robam Appliances

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.

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.

We can see that insiders own shares in Hangzhou Robam Appliances Co., Ltd.. The insiders have a meaningful stake worth CN¥711m. Most would see this as a real positive. It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 28% 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.

Private Company Ownership

It seems that Private Companies own 51%, of the Hangzhou Robam Appliances stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hangzhou Robam Appliances better, we need to consider many other factors. Take risks for example - Hangzhou Robam Appliances has 1 warning sign we think you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.