Malakoff Corporation Berhad's (KLSE:MALAKOF) market cap dropped RM244m last week; individual investors who hold 39% were hit as were institutions

Key Insights

• The considerable ownership by private companies in Malakoff Corporation 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 61% ownership
• Institutional ownership in Malakoff Corporation Berhad is 37%

A look at the shareholders of Malakoff Corporation Berhad (KLSE:MALAKOF) can tell us which group is most powerful. We can see that private companies own the lion's share in the company with 39% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

While institutions, who own 37% shares weren’t spared from last week’s RM244m market cap drop, private companies as a group suffered the maximum losses

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

Check out our latest analysis for Malakoff Corporation Berhad

What Does The Institutional Ownership Tell Us About Malakoff Corporation 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.

As you can see, institutional investors have a fair amount of stake in Malakoff Corporation 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Malakoff Corporation Berhad's historic earnings and revenue below, but keep in mind there's always more to the story.

Malakoff Corporation Berhad is not owned by hedge funds. Indra Cita Sdn Bhd is currently the largest shareholder, with 38% of shares outstanding. In comparison, the second and third largest shareholders hold about 11% and 11% of the stock.

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.

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. 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 Malakoff Corporation 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.

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.

Our information suggests that Malakoff Corporation Berhad insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven't picked up on. It seems the board members have no more than RM8.3m worth of shares in the RM4.3b company. Many investors in smaller companies prefer to see the board more heavily invested. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 13% stake in Malakoff Corporation 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

It seems that Private Companies own 39%, of the Malakoff Corporation Berhad stock. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Malakoff Corporation Berhad (of which 1 is concerning!) you should know about.

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.