Key Insights

• Significant control over Agricultural Bank of China by sovereign wealth funds implies that the general public has more power to influence management and governance-related decisions
• The top 2 shareholders own 75% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

If you want to know who really controls Agricultural Bank of China Limited (HKG:1288), then you'll have to look at the makeup of its share registry. With 47% stake, sovereign wealth funds possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

State or government, on the other hand, account for 35% of the company's stockholders.

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

What Does The Institutional Ownership Tell Us About Agricultural Bank of China?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Agricultural Bank of China already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Agricultural Bank of China's earnings history below. Of course, the future is what really matters.

Agricultural Bank of China is not owned by hedge funds. Central Huijin Investment Ltd. is currently the largest shareholder, with 40% of shares outstanding. In comparison, the second and third largest shareholders hold about 35% and 6.7% of the stock.

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 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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Agricultural Bank of China

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 data cannot confirm that board members are holding shares personally. We do not see this low level of ownership often, and it is possible our data is imperfect. But shareholders can click here to check if insiders have been selling stock.

General Public Ownership

With a 12% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Agricultural Bank of China. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

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.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

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.