Advertisement
New Zealand markets closed
  • NZX 50

    12,105.29
    +94.63 (+0.79%)
     
  • NZD/USD

    0.5976
    -0.0029 (-0.49%)
     
  • NZD/EUR

    0.5533
    -0.0010 (-0.17%)
     
  • ALL ORDS

    8,153.70
    +80.10 (+0.99%)
     
  • ASX 200

    7,896.90
    +77.30 (+0.99%)
     
  • OIL

    82.72
    +1.37 (+1.68%)
     
  • GOLD

    2,235.00
    +22.30 (+1.01%)
     
  • NASDAQ

    18,267.97
    -12.87 (-0.07%)
     
  • FTSE

    7,972.52
    +40.54 (+0.51%)
     
  • Dow Jones

    39,734.95
    -25.13 (-0.06%)
     
  • DAX

    18,505.69
    +28.60 (+0.15%)
     
  • Hang Seng

    16,541.42
    +148.58 (+0.91%)
     
  • NIKKEI 225

    40,168.07
    -594.66 (-1.46%)
     
  • NZD/JPY

    90.3620
    -0.4180 (-0.46%)
     

What Kind Of Shareholder Appears On The China Mengniu Dairy Company Limited’s (HKG:2319) Shareholder Register?

A look at the shareholders of China Mengniu Dairy Company Limited (HKG:2319) can tell us which group is most powerful. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. Companies that have been privatized tend to have low insider ownership.

China Mengniu Dairy is a pretty big company. It has a market capitalization of HK$96.2b. Normally institutions would own a significant portion of a company this size. Our analysis of the ownership of the company, below, shows that institutions are noticeable on the share registry. We can zoom in on the different ownership groups, to learn more about 2319.

View our latest analysis for China Mengniu Dairy

SEHK:2319 Ownership Summary November 12th 18
SEHK:2319 Ownership Summary November 12th 18

What Does The Institutional Ownership Tell Us About China Mengniu Dairy?

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.

ADVERTISEMENT

As you can see, institutional investors own 37% of China Mengniu Dairy. 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. 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 China Mengniu Dairy’s historic earnings and revenue, below, but keep in mind there’s always more to the story.

SEHK:2319 Income Statement Export November 12th 18
SEHK:2319 Income Statement Export November 12th 18

China Mengniu Dairy is not owned by hedge funds. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of China Mengniu Dairy

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. 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 most recent data indicates that insiders own less than 1% of China Mengniu Dairy Company Limited. But they may have an indirect interest through a corporate structure that we haven’t picked up on. As it is a large company, we’d only expect insiders to own a small percentage of it. But it’s worth noting that they own HK$22m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, with a 32% stake in the company, will not easily be ignored. 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

Our data indicates that Private Companies hold 31%, of the company’s shares. 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.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.