Key Insights

• Shengjing Bank's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 5 shareholders own 50% of the company
• 18% of Shengjing Bank is held by Institutions

Every investor in Shengjing Bank Co., Ltd. (HKG:2066) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 55% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While institutions who own 18% came under pressure after market cap dropped to HK$7.2b last week,private companies took the most losses.

In the chart below, we zoom in on the different ownership groups of Shengjing Bank.

What Does The Institutional Ownership Tell Us About Shengjing Bank?

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.

As you can see, institutional investors have a fair amount of stake in Shengjing Bank. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Shengjing Bank's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Shengjing Bank. Looking at our data, we can see that the largest shareholder is Shenyang Shengjing Finance Investment Group Co., Ltd with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 15% and 5.5% of the stock.

On looking further, we found that 50% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Shengjing Bank

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can see that insiders own shares in Shengjing Bank Co., Ltd.. It has a market capitalization of just HK$7.2b, and insiders have HK$591m worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 15% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shengjing Bank. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

It seems that Private Companies own 55%, of the Shengjing Bank 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.

Public Company Ownership

We can see that public companies hold 3.7% of the Shengjing Bank shares on issue. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Shengjing Bank better, we need to consider many other factors. To that end, you should learn about the 2 warning signs we've spotted with Shengjing Bank (including 1 which is potentially serious) .

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.