Public companies are China CITIC Bank Corporation Limited's (HKG:998) biggest owners and were hit after market cap dropped HK$6.9b

Key Insights

• The considerable ownership by public companies in China CITIC Bank indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is CITIC Limited with a 65% stake
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

If you want to know who really controls China CITIC Bank Corporation Limited (HKG:998), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 70% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

And following last week's 3.3% decline in share price, public companies suffered the most losses.

In the chart below, we zoom in on the different ownership groups of China CITIC Bank.

Check out our latest analysis for China CITIC Bank

What Does The Institutional Ownership Tell Us About China CITIC Bank?

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 China CITIC Bank. 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. 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 China CITIC 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 China CITIC Bank. Our data shows that CITIC Limited is the largest shareholder with 65% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. With 4.7% and 4.4% of the shares outstanding respectively, Xinhu Zhongbao Co.,Ltd. and China National Tobacco Corporation are the second and third largest shareholders.

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 China CITIC Bank

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 most recent data indicates that insiders own less than 1% of China CITIC Bank Corporation Limited. But they may have an indirect interest through a corporate structure that we haven't picked up on. It is a very large company, so it would be surprising to see insiders own a large proportion of the company. Though their holding amounts to less than 1%, we can see that board members collectively own HK$54m worth of shares (at current prices). It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

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

Private Company Ownership

It seems that Private Companies own 5.2%, of the China CITIC Bank stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Public Company Ownership

Public companies currently own 70% of China CITIC Bank stock. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand China CITIC Bank better, we need to consider many other factors. For instance, we've identified 2 warning signs for China CITIC Bank (1 is a bit concerning) 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.