Private companies invested in Eco World Development Group Berhad (KLSE:ECOWLD) up 6.3% last week, insiders too were rewarded

Key Insights

• The considerable ownership by private companies in Eco World Development Group Berhad indicates that they collectively have a greater say in management and business strategy
• A total of 3 investors have a majority stake in the company with 51% ownership
• 21% of Eco World Development Group Berhad is held by insiders

Every investor in Eco World Development Group Berhad (KLSE:ECOWLD) should be aware of the most powerful shareholder groups. We can see that private companies own the lion's share in the company with 48% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While private companies were the group that reaped the most benefits after last week’s 6.3% price gain, insiders also received a 21% cut.

In the chart below, we zoom in on the different ownership groups of Eco World Development Group Berhad.

See our latest analysis for Eco World Development Group Berhad

What Does The Institutional Ownership Tell Us About Eco World Development Group 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.

Eco World Development Group Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 Eco World Development Group Berhad's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Eco World Development Group Berhad. Syabas Tropikal Sdn Bhd is currently the largest shareholder, with 33% of shares outstanding. With 10% and 7.5% of the shares outstanding respectively, Kee Liew and Eco World Development Holdings Sdn Bhd are the second and third largest shareholders. Kee Liew, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 Eco World Development Group 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. 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.

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 insiders maintain a significant holding in Eco World Development Group Berhad. Insiders own RM930m worth of shares in the RM4.4b 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-- including retail investors -- own 19% stake in the company, and hence can't 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.

Private Company Ownership

Our data indicates that Private Companies hold 48%, 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:

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. Consider risks, for instance. Every company has them, and we've spotted 3 warning signs for Eco World Development Group Berhad you should know about.

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.