Public companies who hold 53% of BM GreenTech Berhad (KLSE:BMGREEN) gained 11%, insiders profited as well

Key Insights

• Significant control over BM GreenTech Berhad by public companies implies that the general public has more power to influence management and governance-related decisions
• 53% of the company is held by a single shareholder (QL Resources Berhad)
• Insiders own 23% of BM GreenTech Berhad

Every investor in BM GreenTech Berhad (KLSE:BMGREEN) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are public companies with 53% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While public companies were the group that benefitted the most from last week’s RM67m market cap gain, insiders too had a 23% share in those profits.

In the chart below, we zoom in on the different ownership groups of BM GreenTech Berhad.

See our latest analysis for BM GreenTech Berhad

What Does The Lack Of Institutional Ownership Tell Us About BM GreenTech Berhad?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. BM GreenTech Berhad might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

BM GreenTech Berhad is not owned by hedge funds. QL Resources Berhad is currently the company's largest shareholder with 53% of shares outstanding. This implies that they have majority interest control of the future of the company. Meanwhile, the second and third largest shareholders, hold 5.8% and 4.0%, of the shares outstanding, respectively. Chih Gan, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of BM GreenTech Berhad

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.

It seems insiders own a significant proportion of BM GreenTech Berhad. Insiders own RM156m worth of shares in the RM666m company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 23% stake in BM GreenTech Berhad. 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.

Public Company Ownership

We can see that public companies hold 53% of the BM GreenTech Berhad shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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 access this interactive graph of past earnings, revenue and cash flow, for free.

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.