Individual investors invested in Ekovest Berhad (KLSE:EKOVEST) copped the brunt of last week's RM208m market cap decline

Key Insights

• The considerable ownership by individual investors in Ekovest Berhad indicates that they collectively have a greater say in management and business strategy
• The top 18 shareholders own 50% of the company
• Insider ownership in Ekovest Berhad is 23%

Every investor in Ekovest Berhad (KLSE:EKOVEST) should be aware of the most powerful shareholder groups. We can see that individual investors own the lion's share in the company with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While insiders who own 23% came under pressure after market cap dropped to RM1.1b last week,individual investors took the most losses.

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

Check out our latest analysis for Ekovest Berhad

What Does The Institutional Ownership Tell Us About Ekovest Berhad?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in Ekovest Berhad. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Ekovest Berhad, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Ekovest Berhad. Our data suggests that Kang Lim, who is also the company's Top Key Executive, holds the most number of shares at 18%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. With 10% and 4.6% of the shares outstanding respectively, Ekovest Holdings Sdn Bhd and Norges Bank Investment Management are the second and third largest shareholders.

A closer look at our ownership figures suggests that the top 18 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

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 Ekovest Berhad

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

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders maintain a significant holding in Ekovest Berhad. Insiders own RM251m worth of shares in the RM1.1b 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

With a 50% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Ekovest Berhad. 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.

Private Company Ownership

It seems that Private Companies own 13%, of the Ekovest Berhad stock. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Ekovest Berhad better, we need to consider many other factors. For example, we've discovered 2 warning signs for Ekovest Berhad (1 can't be ignored!) that you should be aware of before investing here.

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.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com