Individual investors own 37% of Singapore Airlines Limited (SGX:C6L) shares but private equity firms control 53% of the company

Key Insights

• Significant control over Singapore Airlines by private equity firms implies that the general public has more power to influence management and governance-related decisions
• 53% of the company is held by a single shareholder (Temasek Holdings (Private) Limited)
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

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If you want to know who really controls Singapore Airlines Limited (SGX:C6L), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private equity firms with 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Meanwhile, individual investors make up 37% of the company’s shareholders.

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

View our latest analysis for Singapore Airlines

What Does The Institutional Ownership Tell Us About Singapore Airlines?

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.

We can see that Singapore Airlines does have institutional investors; and they hold a good portion of the company's stock. 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 Singapore Airlines' historic earnings and revenue below, but keep in mind there's always more to the story.

Singapore Airlines is not owned by hedge funds. Our data shows that Temasek Holdings (Private) Limited is the largest shareholder with 53% of shares outstanding. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. For context, the second largest shareholder holds about 1.9% of the shares outstanding, followed by an ownership of 1.6% by the third-largest shareholder.

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 Singapore Airlines

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 Singapore Airlines Limited 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 S$51m 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

With a 37% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Singapore Airlines. 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.

Private Equity Ownership

With a stake of 53%, private equity firms could influence the Singapore Airlines board. Some investors might be encouraged by this, since private equity are sometimes able to encourage strategies that help the market see the value in the company. Alternatively, those holders might be exiting the investment after taking it public.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Singapore Airlines better, we need to consider many other factors. Take risks for example - Singapore Airlines has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

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.