Shin Heung Energy & Electronics Co.,Ltd.'s (KOSDAQ:243840) market cap increased by ₩40b, insiders receive a 27% cut

Key Insights

• Significant insider control over Shin Heung Energy & ElectronicsLtd implies vested interests in company growth
• A total of 3 investors have a majority stake in the company with 52% ownership
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

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To get a sense of who is truly in control of Shin Heung Energy & Electronics Co.,Ltd. (KOSDAQ:243840), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are individual insiders with 27% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 27% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Shin Heung Energy & ElectronicsLtd.

See our latest analysis for Shin Heung Energy & ElectronicsLtd

What Does The Institutional Ownership Tell Us About Shin Heung Energy & ElectronicsLtd?

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.

We can see that Shin Heung Energy & ElectronicsLtd 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. 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 Shin Heung Energy & ElectronicsLtd's historic earnings and revenue below, but keep in mind there's always more to the story.

Shin Heung Energy & ElectronicsLtd is not owned by hedge funds. The company's largest shareholder is Hwa-Bong Choi, with ownership of 20%. The second and third largest shareholders are STIC Investments, Inc. and Second Wave Co.,Ltd., with an equal amount of shares to their name at 16%.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Shin Heung Energy & ElectronicsLtd

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders maintain a significant holding in Shin Heung Energy & Electronics Co.,Ltd.. Insiders own ₩52b worth of shares in the ₩193b company. 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

With a 26% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Shin Heung Energy & ElectronicsLtd. 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 Equity Ownership

With a stake of 16%, private equity firms could influence the Shin Heung Energy & ElectronicsLtd board. 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. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Shin Heung Energy & ElectronicsLtd better, we need to consider many other factors. To that end, you should learn about the 4 warning signs we've spotted with Shin Heung Energy & ElectronicsLtd (including 1 which shouldn't be ignored) .

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.