Retail investors who have a significant stake must be disappointed along with institutions after GS Engineering & Construction Corporation's (KRX:006360) market cap dropped by ₩183b

Key Insights

• The considerable ownership by retail investors in GS Engineering & Construction indicates that they collectively have a greater say in management and business strategy
• The top 16 shareholders own 50% of the company
• Insiders own 22% of GS Engineering & Construction

To get a sense of who is truly in control of GS Engineering & Construction Corporation (KRX:006360), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 48% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions who own 28% came under pressure after market cap dropped to ₩1.5t last week,retail investors took the most losses.

In the chart below, we zoom in on the different ownership groups of GS Engineering & Construction.

See our latest analysis for GS Engineering & Construction

What Does The Institutional Ownership Tell Us About GS Engineering & Construction?

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 GS Engineering & Construction. 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 GS Engineering & Construction's historic earnings and revenue below, but keep in mind there's always more to the story.

GS Engineering & Construction is not owned by hedge funds. Chang-Soo Huh is currently the company's largest shareholder with 10% of shares outstanding. For context, the second largest shareholder holds about 9.6% of the shares outstanding, followed by an ownership of 5.7% by the third-largest shareholder.

After doing some more digging, we found that the top 16 have the combined ownership of 50% in the company, suggesting that no single shareholder has significant control over the company.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of GS Engineering & Construction

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 GS Engineering & Construction Corporation. Insiders own ₩326b worth of shares in the ₩1.5t company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 48% stake in GS Engineering & Construction. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand GS Engineering & Construction better, we need to consider many other factors. For example, we've discovered 2 warning signs for GS Engineering & Construction that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.