Hua Xia Bank Co., Limited's (SHSE:600015) largest shareholders are private companies with 57% ownership, individual investors own 17%

Key Insights

• Significant control over Hua Xia Bank by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 3 shareholders own 57% of the company
• Institutions own 10% of Hua Xia Bank

Every investor in Hua Xia Bank Co., Limited (SHSE:600015) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 57% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And individual investors on the other hand have a 17% ownership in the company.

Let's take a closer look to see what the different types of shareholders can tell us about Hua Xia Bank.

View our latest analysis for Hua Xia Bank

What Does The Institutional Ownership Tell Us About Hua Xia Bank?

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.

As you can see, institutional investors have a fair amount of stake in Hua Xia Bank. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Hua Xia Bank's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Hua Xia Bank. Beijing State-owned Capital Operation and Management Company Limited is currently the company's largest shareholder with 22% of shares outstanding. State Grid Corporation of China is the second largest shareholder owning 19% of common stock, and The People's Insurance Company (Group) of China Limited holds about 16% of the company stock.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Hua Xia Bank

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.

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.

Our data cannot confirm that board members are holding shares personally. It is unusual not to have at least some personal holdings by board members, so our data might be flawed. A good next step would be to check how much the CEO is paid.

General Public Ownership

The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 57%, of the Hua Xia 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

Public companies currently own 16% of Hua Xia Bank stock. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For instance, we've identified 1 warning sign for Hua Xia Bank that you should be aware of.

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.

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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.