Singapore Airlines largest shareholders are private equity firms with 55% ownership

If you want to know who really controls Singapore Airlines Limited (SGX:C6L) $SINGAPORE AIRLINES LTD(C6L.SI)$ , 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 55% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Individual investors, on the other hand, account for 38% of the company's stockholders.

Let's delve deeper into each type of owner of Singapore Airlines, beginning with the chart below.

SGX:C6L Ownership Breakdown January 14th 2022

What Does The Institutional Ownership Tell Us About Singapore Airlines?

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 Singapore Airlines. 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. 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 Singapore Airlines, (below). Of course, keep in mind that there are other factors to consider, too.

SGX:C6L Earnings and Revenue Growth January 14th 2022

We note that hedge funds don't have a meaningful investment in Singapore Airlines. Temasek Holdings (Private) Limited is currently the company's largest shareholder with 55% of shares outstanding. This implies that they have majority interest control of the future of the company. In comparison, the second and third largest shareholders hold about 1.5% and 1.1% of the stock.

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 are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Singapore Airlines

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our information suggests that Singapore Airlines Limited insiders own under 1% of the company. 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 S$20m worth of shares. It is good to see board members owning shares, but it might be worth checkingif those insiders have been buying.

General Public Ownership

The general public-- including retail investors -- own 38% stake in the company, and hence can't easily be ignored. 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.

Private Equity Ownership

With an ownership of 55%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. 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.

source: simplywall.st