Could The DKSH Holdings (Malaysia) Berhad (KLSE:DKSH) Ownership Structure Tell Us Something Useful?

Every investor in DKSH Holdings (Malaysia) Berhad (KLSE:DKSH) should be aware of the most powerful shareholder groups. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. Companies that used to be publicly owned tend to have lower insider ownership.

With a market capitalization of RM560m, DKSH Holdings (Malaysia) Berhad is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about DKSH Holdings (Malaysia) Berhad.

See our latest analysis for DKSH Holdings (Malaysia) Berhad

What Does The Institutional Ownership Tell Us About DKSH Holdings (Malaysia) Berhad?

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.

DKSH Holdings (Malaysia) Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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 DKSH Holdings (Malaysia) Berhad, (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 DKSH Holdings (Malaysia) Berhad. The company's largest shareholder is DKSH Holding AG, with ownership of 74%. This implies that they have majority interest control of the future of the company. With 4.8% and 1.9% of the shares outstanding respectively, Lembaga Tabung Angkatan Tentera (LTAT) and Lemanik Asset Management S.A. are the second and third largest shareholders.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. 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 DKSH Holdings (Malaysia) Berhad

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

We can see that insiders own shares in DKSH Holdings (Malaysia) Berhad. As individuals, the insiders collectively own RM9.1m worth of the RM560m company. This shows at least some alignment, but I usually like to see larger insider holdings. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, with a 12% stake in the company, will not easily be ignored. 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.

Public Company Ownership

It appears to us that public companies own 74% of DKSH Holdings (Malaysia) Berhad. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand DKSH Holdings (Malaysia) Berhad better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with DKSH Holdings (Malaysia) Berhad .

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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. 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.
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