Key Insights

• Significant control over China Bester Group Telecom by retail investors implies that the general public has more power to influence management and governance-related decisions
• The top 25 shareholders own 45% of the company
• Insider ownership in China Bester Group Telecom is 41%

If you want to know who really controls China Bester Group Telecom Co., Ltd. (SHSE:603220), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are retail investors with 55% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While retail investors were the group that benefitted the most from last week's CN¥741m market cap gain, insiders too had a 41% share in those profits.

Let's take a closer look to see what the different types of shareholders can tell us about China Bester Group Telecom.

What Does The Institutional Ownership Tell Us About China Bester Group Telecom?

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.

Institutions have a very small stake in China Bester Group Telecom. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

We note that hedge funds don't have a meaningful investment in China Bester Group Telecom. Looking at our data, we can see that the largest shareholder is the CEO Liubing Li with 27% of shares outstanding. Man Mei is the second largest shareholder owning 5.0% of common stock, and Li Yu holds about 2.1% of the company stock.

On studying our ownership data, we found that 25 of the top shareholders collectively own less than 50% of the share register, implying that no single individual has a majority interest.

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 China Bester Group Telecom

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.

Our most recent data indicates that insiders own a reasonable proportion of China Bester Group Telecom Co., Ltd.. It has a market capitalization of just CN¥12b, and insiders have CN¥5.0b worth of shares in their own names. That's quite significant. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a substantial 55% stake in China Bester Group Telecom, suggesting it is a fairly popular stock. With this amount of ownership, retail investors can collectively play a role in decisions that affect shareholder returns, such as dividend policies and the appointment of directors. They can also exercise the power to vote on acquisitions or mergers that may not improve profitability.

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. Case in point: We've spotted 3 warning signs for China Bester Group Telecom you should be aware of, and 2 of them are a bit concerning.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.