Lotte Chilsung Beverage Co., Ltd.'s (KRX:005300) market cap touched ₩1.3t last week, benefiting both public companies who own 43% as well as institutions

Key Insights

• The considerable ownership by public companies in Lotte Chilsung Beverage indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 52% ownership
• 30% of Lotte Chilsung Beverage is held by Institutions

Every investor in Lotte Chilsung Beverage Co., Ltd. (KRX:005300) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 43% 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.

Public companies gained the most after market cap touched ₩1.3t last week, while institutions who own 30% also benefitted.

Let's delve deeper into each type of owner of Lotte Chilsung Beverage, beginning with the chart below.

View our latest analysis for Lotte Chilsung Beverage

What Does The Institutional Ownership Tell Us About Lotte Chilsung Beverage?

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 Lotte Chilsung Beverage. 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 Lotte Chilsung Beverage's historic earnings and revenue below, but keep in mind there's always more to the story.

Lotte Chilsung Beverage is not owned by hedge funds. The company's largest shareholder is LOTTE Corporation, with ownership of 43%. National Pension Service is the second largest shareholder owning 9.1% of common stock, and Lotte Aluminium Co., Ltd. holds about 7.4% of the company stock.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 52% stake.

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 Lotte Chilsung Beverage

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.

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 most recent data indicates that insiders own some shares in Lotte Chilsung Beverage Co., Ltd.. As individuals, the insiders collectively own ₩91b worth of the ₩1.3t company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 11% stake in Lotte Chilsung Beverage. 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

We can see that Private Companies own 8.8%, of the shares on issue. 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.

Public Company Ownership

Public companies currently own 43% of Lotte Chilsung Beverage stock. 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:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Be aware that Lotte Chilsung Beverage is showing 2 warning signs in our investment analysis , and 1 of those makes us a bit uncomfortable...

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.