Individual investors who hold 34% of Malayan Flour Mills Berhad (KLSE:MFLOUR) gained 12%, insiders profited as well

Key Insights

• The considerable ownership by individual investors in Malayan Flour Mills Berhad indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 10 shareholders
• Insiders own 30% of Malayan Flour Mills Berhad

To get a sense of who is truly in control of Malayan Flour Mills Berhad (KLSE:MFLOUR), it is important to understand the ownership structure of the business. We can see that individual investors own the lion's share in the company with 34% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Individual investors gained the most after market cap touched RM991m last week, while insiders who own 30% also benefitted.

In the chart below, we zoom in on the different ownership groups of Malayan Flour Mills Berhad.

Check out our latest analysis for Malayan Flour Mills Berhad

What Does The Institutional Ownership Tell Us About Malayan Flour Mills Berhad?

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.

As you can see, institutional investors have a fair amount of stake in Malayan Flour Mills Berhad. 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 Malayan Flour Mills Berhad's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Malayan Flour Mills Berhad. With a 16% stake, CEO Wee Teh is the largest shareholder. For context, the second largest shareholder holds about 6.2% of the shares outstanding, followed by an ownership of 5.4% by the third-largest shareholder.

On further inspection, we found that more than half the company's shares are owned by the top 10 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.

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 Malayan Flour Mills Berhad

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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 most recent data indicates that insiders own a reasonable proportion of Malayan Flour Mills Berhad. It has a market capitalization of just RM991m, and insiders have RM294m worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Malayan Flour Mills Berhad. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 24%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Malayan Flour Mills Berhad better, we need to consider many other factors. To that end, you should be aware of the 4 warning signs we've spotted with Malayan Flour Mills 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. 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.