Inner Mongolia MengDian HuaNeng Thermal Power Corporation Limited's (SHSE:600863) largest shareholders are private companies who were rewarded as market cap surged CN¥3.3b last week

Key Insights

• The considerable ownership by private companies in Inner Mongolia MengDian HuaNeng Thermal Power indicates that they collectively have a greater say in management and business strategy
• 51% of the company is held by a single shareholder (China Huaneng Group Co., Ltd.)
• 10% of Inner Mongolia MengDian HuaNeng Thermal Power is held by Institutions

To get a sense of who is truly in control of Inner Mongolia MengDian HuaNeng Thermal Power Corporation Limited (SHSE:600863), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 51% to be precise, is private companies. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, private companies collectively scored the highest last week as the company hit CN¥31b market cap following a 12% gain in the stock.

Let's delve deeper into each type of owner of Inner Mongolia MengDian HuaNeng Thermal Power, beginning with the chart below.

See our latest analysis for Inner Mongolia MengDian HuaNeng Thermal Power

What Does The Institutional Ownership Tell Us About Inner Mongolia MengDian HuaNeng Thermal Power?

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 Inner Mongolia MengDian HuaNeng Thermal Power 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. 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 Inner Mongolia MengDian HuaNeng Thermal Power's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Inner Mongolia MengDian HuaNeng Thermal Power. Our data shows that China Huaneng Group Co., Ltd. is the largest shareholder with 51% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Tianjin Huaren Investment Management Co., Ltd. is the second largest shareholder owning 2.0% of common stock, and True Horizon Asset Management Co., Ltd. holds about 0.8% of the company stock.

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 Inner Mongolia MengDian HuaNeng Thermal Power

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.

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 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-- including retail investors -- own 39% 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 51%, 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:

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 Inner Mongolia MengDian HuaNeng Thermal Power .

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.