Retail investors invested in Kyeryong Construction Industrial Co., Ltd. (KRX:013580) copped the brunt of last week's ₩77b market cap decline

Key Insights

• Significant control over Kyeryong Construction Industrial by retail investors implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 5 shareholders
• Insider ownership in Kyeryong Construction Industrial is 33%

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Every investor in Kyeryong Construction Industrial Co., Ltd. (KRX:013580) should be aware of the most powerful shareholder groups. With 49% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders, who own 33% shares weren’t spared from last week’s ₩77b market cap drop, retail investors as a group suffered the maximum losses

Let's take a closer look to see what the different types of shareholders can tell us about Kyeryong Construction Industrial.

Check out our latest analysis for Kyeryong Construction Industrial

What Does The Institutional Ownership Tell Us About Kyeryong Construction Industrial?

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.

We can see that Kyeryong Construction Industrial 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. 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 Kyeryong Construction Industrial, (below). Of course, keep in mind that there are other factors to consider, too.

Kyeryong Construction Industrial is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Seung-Chan Lee with 30% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 10% and 5.6%, of the shares outstanding, respectively.

On looking further, we found that 51% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Kyeryong Construction Industrial

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 most recent data indicates that insiders own a reasonable proportion of Kyeryong Construction Industrial Co., Ltd.. It has a market capitalization of just ₩201b, and insiders have ₩67b worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 49% stake in Kyeryong Construction Industrial. 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 Kyeryong Construction Industrial better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for Kyeryong Construction Industrial (of which 3 are potentially serious!) 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.