Chongqing Changan Automobile Company Limited's (SZSE:000625) largest shareholders are individual investors with 47% ownership, private companies own 35%

Key Insights

• Significant control over Chongqing Changan Automobile by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 17 shareholders own 50% of the company
• Institutional ownership in Chongqing Changan Automobile is 18%

To get a sense of who is truly in control of Chongqing Changan Automobile Company Limited (SZSE:000625), it is important to understand the ownership structure of the business. With 47% stake, individual investors possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Private companies, on the other hand, account for 35% of the company's stockholders.

Let's take a closer look to see what the different types of shareholders can tell us about Chongqing Changan Automobile.

View our latest analysis for Chongqing Changan Automobile

What Does The Institutional Ownership Tell Us About Chongqing Changan Automobile?

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 Chongqing Changan Automobile 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 Chongqing Changan Automobile, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Chongqing Changan Automobile. Looking at our data, we can see that the largest shareholder is China South Industries Group Co.,Ltd. with 35% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.6% and 4.3%, of the shares outstanding, respectively.

Looking at the shareholder registry, we can see that 50% of the ownership is controlled by the top 17 shareholders, meaning that no single shareholder has a majority interest in the ownership.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Chongqing Changan Automobile

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 data suggests that insiders own under 1% of Chongqing Changan Automobile Company Limited in their own names. But they may have an indirect interest through a corporate structure that we haven't picked up on. Being so large, we would not expect insiders to own a large proportion of the stock. Collectively, they own CN¥62m of stock. In this sort of situation, it can be more interesting to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 47% stake in the company, and hence can't easily be ignored. 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

We can see that Private Companies own 35%, 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Chongqing Changan Automobile better, we need to consider many other factors. Be aware that Chongqing Changan Automobile is showing 3 warning signs in our investment analysis , and 1 of those is concerning...

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.