The market capitalization of Ping An Insurance (Group) Company of China, Ltd. (HKG:2318) reached HK$963 billion last week, benefiting both individual investors who own 57% and institutions

If you want to know who actually controls Ping An Insurance (Group) Company of China, Ltd. (HKG:2318), you will then need to examine the composition of its share register. And the group that holds the biggest slice of the pie are individual investors with 57% ownership. That is, the group will benefit the most if the stock goes up (or lose the most if there is a downturn).

Individual investors gained the most after market capitalization hit HK$963 billion last week, while institutions holding 29% also benefited.

In the table below, we zoom in on the different ownership groups of Ping An Insurance (Group) Company of China.

See our latest analysis for Ping An Insurance (Group) Company of China

SEHK: 2318 Ownership Breakdown June 19, 2022

What does institutional ownership tell us about Ping An Insurance (Group) Company of China?

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.

Ping An Insurance (Group) Company of China already has institutions registered in the share register. Indeed, they hold a respectable stake in the company. This may indicate that the company has some degree of credibility in the investment community. However, it is best to be wary of relying on the so-called validation that accompanies institutional investors. They are also sometimes wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see the historical earnings and revenue of Ping An Insurance (Group) Company of China below, but keep in mind there’s always more to tell.

earnings-and-revenue-growth
SEHK: 2318 Profit and Revenue Growth June 19, 2022

We note that hedge funds have no significant investment in Ping An Insurance (Group) Company of China. Our data shows that Charoen Pokphand Group Co., Ltd. is the main shareholder with 7.0% of the outstanding shares. Meanwhile, the second and third largest shareholders hold 5.3% and 2.4% of the outstanding shares respectively.

A closer look at our ownership data shows that the top 25 shareholders collectively own less than half of the ledger, suggesting a large group of small shareholders where no single shareholder has a majority.

While it makes sense to study data on a company’s institutional ownership, it also makes sense to study analyst sentiment to find out which way the wind is blowing. A number of analysts cover the stock, so you can look at growth forecasts quite easily.

Insider ownership of Ping An Insurance (Group) Company of China

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.

Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.

Our data suggests that insiders own less than 1% of Ping An Insurance (Group) Company of China, Ltd. in their own name. But they may have an indirect interest through a corporate structure that we have not noted. Being so large, we wouldn’t expect insiders to own a large portion of the shares. Collectively they own HK$585 million worth of shares. It’s good to see board members owning stock, but it can be helpful to check whether those insiders have bought.

General public property

The general public, including retail investors, owns 57% of Ping An Insurance (Group) Company of China. This size of ownership gives mainstream investors a certain collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed corporate acquisitions.

Private Company Ownership

It seems that private companies hold 14% of the shares of Ping An Insurance (Group) of China. It’s hard to draw conclusions from this fact alone, so it’s worth investigating who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.

Next steps:

I find it very interesting to see who exactly owns a business. But to really get insight, we also need to consider other information. For example, we found 1 warning sign for Ping An Insurance (Group) Company of China which you should be aware of before investing here.

If you’re like me, you might want to ask yourself if this business will grow or shrink. Luckily, you can check out this free report showing analyst predictions for its future.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.