Private companies own 23% of Beijing-Shanghai High-Speed Railway Co., Ltd. (SHSE:601816) shares but private equity firms control 43% of the company

Key Insights

• Significant control over Beijing-Shanghai High-Speed Railway by private equity firms implies that the general public has more power to influence management and governance-related decisions
• 54% of the business is held by the top 3 shareholders
• Institutions own 10% of Beijing-Shanghai High-Speed Railway

To get a sense of who is truly in control of Beijing-Shanghai High-Speed Railway Co., Ltd. (SHSE:601816), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are private equity firms with 43% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Meanwhile, private companies make up 23% of the company’s shareholders.

In the chart below, we zoom in on the different ownership groups of Beijing-Shanghai High-Speed Railway.

See our latest analysis for Beijing-Shanghai High-Speed Railway

What Does The Institutional Ownership Tell Us About Beijing-Shanghai High-Speed Railway?

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.

Beijing-Shanghai High-Speed Railway already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Beijing-Shanghai High-Speed Railway's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Beijing-Shanghai High-Speed Railway. Our data shows that China Railway Investment Group Co., Ltd. is the largest shareholder with 43% of shares outstanding. In comparison, the second and third largest shareholders hold about 6.2% and 4.8% of the stock.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 54% stake.

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 Beijing-Shanghai High-Speed Railway

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public, who are usually individual investors, hold a 17% stake in Beijing-Shanghai High-Speed Railway. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

Private equity firms hold a 43% stake in Beijing-Shanghai High-Speed Railway. This suggests they can be influential in key policy decisions. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 23%, of the company's shares. 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. To that end, you should be aware of the 1 warning sign we've spotted with Beijing-Shanghai High-Speed Railway .

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.