Retail investors among Geely Automobile Holdings Limited's (HKG:175) largest shareholders, saw gain in holdings value after stock jumped 19% last week

Key Insights

• Significant control over Geely Automobile Holdings by retail investors implies that the general public has more power to influence management and governance-related decisions
• A total of 5 investors have a majority stake in the company with 50% ownership
• Institutions own 17% of Geely Automobile Holdings

If you want to know who really controls Geely Automobile Holdings Limited (HKG:175), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 42% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Clearly, retail investors benefitted the most after the company's market cap rose by HK$25b last week.

In the chart below, we zoom in on the different ownership groups of Geely Automobile Holdings.

Check out our latest analysis for Geely Automobile Holdings

What Does The Institutional Ownership Tell Us About Geely Automobile Holdings?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

As you can see, institutional investors have a fair amount of stake in Geely Automobile Holdings. 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 Geely Automobile Holdings' earnings history below. Of course, the future is what really matters.

Geely Automobile Holdings is not owned by hedge funds. Zhejiang Geely Holding Group Co., Ltd. is currently the largest shareholder, with 39% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.7% and 2.2%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Geely Automobile Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 can see that insiders own shares in Geely Automobile Holdings Limited. The insiders have a meaningful stake worth HK$3.9b. Most would say this shows a good alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 42% 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 39%, of the Geely Automobile Holdings 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.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - Geely Automobile Holdings has 2 warning signs (and 1 which is a bit concerning) we think you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.