Public companies are Hanwha Systems Co., Ltd.'s (KRX:272210) biggest owners and were hit after market cap dropped ₩280b

Key Insights

• Hanwha Systems' significant public companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 2 shareholders own 60% of the company
• Institutions own 13% of Hanwha Systems

If you want to know who really controls Hanwha Systems Co., Ltd. (KRX:272210), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 60% to be precise, is public companies. Put another way, the group faces the maximum upside potential (or downside risk).

As market cap fell to ₩5.9t last week, public companies would have faced the highest losses than any other shareholder groups of the company.

Let's delve deeper into each type of owner of Hanwha Systems, beginning with the chart below.

View our latest analysis for Hanwha Systems

What Does The Institutional Ownership Tell Us About Hanwha Systems?

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 Hanwha Systems. 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. 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 Hanwha Systems, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Hanwha Systems. Looking at our data, we can see that the largest shareholder is Hanwha Aerospace Co., Ltd. with 47% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 13% and 8.3%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 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 Hanwha Systems

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 data suggests that insiders own under 1% of Hanwha Systems Co., Ltd. in their own names. Keep in mind that it's a big company, and the insiders own ₩5.5m worth of shares. The absolute value might be more important than the proportional share. Arguably, recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 25% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Hanwha Systems. 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.

Public Company Ownership

We can see that public companies hold 60% of the Hanwha Systems shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Hanwha Systems better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Hanwha Systems you should be aware of.

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.