Private companies invested in China Overseas Grand Oceans Group Limited (HKG:81) copped the brunt of last week's HK$1.0b market cap decline

Key Insights

• Significant control over China Overseas Grand Oceans Group by private companies implies that the general public has more power to influence management and governance-related decisions
• A total of 2 investors have a majority stake in the company with 51% ownership
• Insiders have bought recently

Every investor in China Overseas Grand Oceans Group Limited (HKG:81) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 41% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, private companies endured the biggest losses as the stock fell by 15%.

Let's delve deeper into each type of owner of China Overseas Grand Oceans Group, beginning with the chart below.

View our latest analysis for China Overseas Grand Oceans Group

What Does The Institutional Ownership Tell Us About China Overseas Grand Oceans Group?

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.

China Overseas Grand Oceans Group already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of China Overseas Grand Oceans Group, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in China Overseas Grand Oceans Group. China Construction Engineering Corp. is currently the company's largest shareholder with 40% of shares outstanding. With 11% and 6.0% of the shares outstanding respectively, Kwok Kee Yung and Fidelity International Ltd are the second and third largest shareholders.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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 China Overseas Grand Oceans Group

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.

It seems insiders own a significant proportion of China Overseas Grand Oceans Group Limited. Insiders have a HK$676m stake in this HK$5.9b business. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 27% stake in China Overseas Grand Oceans Group. 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

Our data indicates that Private Companies hold 41%, of the company's shares. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 3 warning signs for China Overseas Grand Oceans Group you should be aware of, and 1 of them is a bit unpleasant.

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.