Daewoo Engineering & Construction Co., Ltd.'s (KRX:047040) biggest owners are private companies who got richer after stock soared 5.4% last week

Key Insights

• Significant control over Daewoo Engineering & Construction by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 51% of the company
• 15% of Daewoo Engineering & Construction is held by Institutions

If you want to know who really controls Daewoo Engineering & Construction Co., Ltd. (KRX:047040), then you'll have to look at the makeup of its share registry. With 51% stake, private companies 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.

As a result, private companies collectively scored the highest last week as the company hit ₩1.6t market cap following a 5.4% gain in the stock.

Let's delve deeper into each type of owner of Daewoo Engineering & Construction, beginning with the chart below.

View our latest analysis for Daewoo Engineering & Construction

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

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Daewoo Engineering & Construction already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 Daewoo Engineering & Construction'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 Daewoo Engineering & Construction. The company's largest shareholder is Jungheung Togun Co.,Ltd., with ownership of 41%. With 10% and 6.1% of the shares outstanding respectively, Jungheung Construction.Co.,Ltd. and National Pension Service are the second and third largest shareholders.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of 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 Daewoo Engineering & Construction

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Our most recent data indicates that insiders own less than 1% of Daewoo Engineering & Construction Co., Ltd.. However, it's possible that insiders might have an indirect interest through a more complex structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around ₩48m worth of shares (at current prices). It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Daewoo Engineering & Construction. 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 51%, of the company's shares. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Daewoo Engineering & Construction better, we need to consider many other factors. Take risks for example - Daewoo Engineering & Construction has 1 warning sign we think you should be aware of.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com