HD Hyundai Heavy Industries Co.,Ltd.'s (KRX:329180) market cap dropped ₩1.6t last week; Public companies bore the brunt

Key Insights

• The considerable ownership by public companies in HD Hyundai Heavy IndustriesLtd indicates that they collectively have a greater say in management and business strategy
• HD Korea Shipbuilding & Offshore Engineering Co., Ltd. owns 75% of the company
• 11% of HD Hyundai Heavy IndustriesLtd is held by Institutions

To get a sense of who is truly in control of HD Hyundai Heavy Industries Co.,Ltd. (KRX:329180), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 75% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As market cap fell to ₩16t last week, public companies would have faced the highest losses than any other shareholder groups of the company.

In the chart below, we zoom in on the different ownership groups of HD Hyundai Heavy IndustriesLtd.

Check out our latest analysis for HD Hyundai Heavy IndustriesLtd

What Does The Institutional Ownership Tell Us About HD Hyundai Heavy IndustriesLtd?

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.

HD Hyundai Heavy IndustriesLtd already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at HD Hyundai Heavy IndustriesLtd's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in HD Hyundai Heavy IndustriesLtd. HD Korea Shipbuilding & Offshore Engineering Co., Ltd. is currently the company's largest shareholder with 75% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. National Pension Service is the second largest shareholder owning 6.1% of common stock, and The Vanguard Group, Inc. holds about 0.9% of the company stock.

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. 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 HD Hyundai Heavy IndustriesLtd

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. 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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our data suggests that insiders own under 1% of HD Hyundai Heavy Industries Co.,Ltd. in their own names. It is a very large company, so it would be surprising to see insiders own a large proportion of the company. Though their holding amounts to less than 1%, we can see that board members collectively own ₩195m worth of shares (at current prices). 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

The general public, who are usually individual investors, hold a 14% stake in HD Hyundai Heavy IndustriesLtd. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Public Company Ownership

It appears to us that public companies own 75% of HD Hyundai Heavy IndustriesLtd. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand HD Hyundai Heavy IndustriesLtd better, we need to consider many other factors.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.