Private companies invested in Haichang Ocean Park Holdings Ltd. (HKG:2255) copped the brunt of last week's HK$396m market cap decline

Key Insights

• Significant control over Haichang Ocean Park Holdings by private companies implies that the general public has more power to influence management and governance-related decisions
• 68% of the business is held by the top 2 shareholders
• Insider ownership in Haichang Ocean Park Holdings is 29%

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If you want to know who really controls Haichang Ocean Park Holdings Ltd. (HKG:2255), then you'll have to look at the makeup of its share registry. With 39% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 4.1% decrease in the stock price last week, private companies suffered the most losses, but insiders who own 29% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Haichang Ocean Park Holdings.

View our latest analysis for Haichang Ocean Park Holdings

What Does The Institutional Ownership Tell Us About Haichang Ocean Park Holdings?

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.

As you can see, institutional investors have a fair amount of stake in Haichang Ocean Park Holdings. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Haichang Ocean Park Holdings, (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 Haichang Ocean Park Holdings. Shanghai Xiangyuanyuan Information Consulting Co., Ltd. is currently the largest shareholder, with 39% of shares outstanding. With 29% and 6.0% of the shares outstanding respectively, Cheng Qu and ORIX Asset Management Corporation are the second and third largest shareholders. Cheng Qu, who is the second-largest shareholder, also happens to hold the title of Senior Key Executive.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Haichang Ocean Park Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders maintain a significant holding in Haichang Ocean Park Holdings Ltd.. Insiders own HK$2.8b worth of shares in the HK$9.4b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 19% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Haichang Ocean Park Holdings. 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 Company Ownership

It seems that Private Companies own 39%, of the Haichang Ocean Park Holdings stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

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. For example, we've discovered 1 warning sign for Haichang Ocean Park Holdings that you should be aware of before investing here.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.