Key Insights

• ZheJiang KangLongDa Special Protection Technology's significant insider ownership suggests inherent interests in company's expansion
• The top 4 shareholders own 53% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

To get a sense of who is truly in control of ZheJiang KangLongDa Special Protection Technology Co., Ltd (SHSE:603665), it is important to understand the ownership structure of the business. With 47% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders were the biggest beneficiaries of last week's 9.3% gain.

Let's delve deeper into each type of owner of ZheJiang KangLongDa Special Protection Technology, beginning with the chart below.

View our latest analysis for ZheJiang KangLongDa Special Protection Technology

What Does The Institutional Ownership Tell Us About ZheJiang KangLongDa Special Protection Technology?

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.

Institutions have a very small stake in ZheJiang KangLongDa Special Protection Technology. 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.

Hedge funds don't have many shares in ZheJiang KangLongDa Special Protection Technology. Looking at our data, we can see that the largest shareholder is Jian Zhang with 16% of shares outstanding. Huili Zhang is the second largest shareholder owning 16% of common stock, and Jianfang Zhang holds about 15% of the company stock. Jianfang Zhang, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

Our research also brought to light the fact that roughly 53% of the company is controlled by the top 4 shareholders suggesting that these owners wield significant influence on the business.

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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of ZheJiang KangLongDa Special Protection Technology

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

It seems insiders own a significant proportion of ZheJiang KangLongDa Special Protection Technology Co., Ltd. Insiders have a CN¥2.1b stake in this CN¥4.4b business. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 40% stake in ZheJiang KangLongDa Special Protection Technology. 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

We can see that Private Companies own 7.5%, of the shares on issue. 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 4 warning signs for ZheJiang KangLongDa Special Protection Technology (2 are a bit concerning!) that you should be aware of before investing here.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.