Public companies are LOTTE INNOVATE Co.,Ltd's (KRX:286940) biggest owners and were hit after market cap dropped ₩45b

Key Insights

• Significant control over LOTTE INNOVATELtd by public companies implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is LOTTE Corporation with a 68% stake
• Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company

A look at the shareholders of LOTTE INNOVATE Co.,Ltd (KRX:286940) can tell us which group is most powerful. We can see that public companies own the lion's share in the company with 67% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, public companies endured the biggest losses as the stock fell by 13%.

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

Check out our latest analysis for LOTTE INNOVATELtd

What Does The Institutional Ownership Tell Us About LOTTE INNOVATELtd?

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.

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

We note that hedge funds don't have a meaningful investment in LOTTE INNOVATELtd. Our data shows that LOTTE Corporation is the largest shareholder with 68% 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 5.0% of common stock, and SHINYOUNG Asset Management Co., Ltd. holds about 2.2% of the company stock.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of LOTTE INNOVATELtd

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.

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 LOTTE INNOVATE Co.,Ltd. It appears that the board holds about ₩256m worth of stock. This compares to a market capitalization of ₩286b. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. 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

Public companies currently own 67% of LOTTE INNOVATELtd stock. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand LOTTE INNOVATELtd better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for LOTTE INNOVATELtd you should be aware of, and 1 of them makes us a bit uncomfortable.

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.