Private companies who hold 44% of Hunan Heshun Petroleum Co.,Ltd. (SHSE:603353) gained 15%, insiders profited as well

Key Insights

• The considerable ownership by private companies in Hunan Heshun PetroleumLtd indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 67% ownership
• Insider ownership in Hunan Heshun PetroleumLtd is 29%

To get a sense of who is truly in control of Hunan Heshun Petroleum Co.,Ltd. (SHSE:603353), 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 44% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Private companies gained the most after market cap touched CN¥2.2b last week, while insiders who own 29% also benefitted.

Let's delve deeper into each type of owner of Hunan Heshun PetroleumLtd, beginning with the chart below.

Check out our latest analysis for Hunan Heshun PetroleumLtd

What Does The Institutional Ownership Tell Us About Hunan Heshun PetroleumLtd?

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.

Less than 5% of Hunan Heshun PetroleumLtd is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Hunan Heshun PetroleumLtd. Looking at our data, we can see that the largest shareholder is Hunan Heshun Investment Development Co., Ltd. with 42% of shares outstanding. For context, the second largest shareholder holds about 25% of the shares outstanding, followed by an ownership of 3.9% by the third-largest shareholder. Xiaozhen Long, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Hunan Heshun PetroleumLtd

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.

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 information suggests that insiders maintain a significant holding in Hunan Heshun Petroleum Co.,Ltd.. Insiders own CN¥635m worth of shares in the CN¥2.2b company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 24% stake in the company, and hence can't easily be ignored. 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 44%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. Take risks for example - Hunan Heshun PetroleumLtd has 1 warning sign we think you should be aware of.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.