Public companies who hold 53% of Ranhill Utilities Berhad (KLSE:RANHILL) gained 13%, institutions profited as well

Key Insights

• The considerable ownership by public companies in Ranhill Utilities Berhad indicates that they collectively have a greater say in management and business strategy
• YTL Power International Berhad owns 53% of the company
• Institutional ownership in Ranhill Utilities Berhad is 20%

Every investor in Ranhill Utilities Berhad (KLSE:RANHILL) should be aware of the most powerful shareholder groups. We can see that public companies own the lion's share in the company with 53% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Public companies gained the most after market cap touched RM1.9b last week, while institutions who own 20% also benefitted.

In the chart below, we zoom in on the different ownership groups of Ranhill Utilities Berhad.

View our latest analysis for Ranhill Utilities Berhad

What Does The Institutional Ownership Tell Us About Ranhill Utilities 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 Ranhill Utilities 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 Ranhill Utilities Berhad, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Ranhill Utilities Berhad. YTL Power International Berhad is currently the largest shareholder, with 53% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. The second and third largest shareholders are UOB Asset Management Limited and Permodalan Darul Ta'zim Sdn Bhd, with an equal amount of shares to their name at 9.1%.

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. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Ranhill Utilities 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.

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 data suggests that insiders own under 1% of Ranhill Utilities Berhad in their own names. 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 RM9.4m worth of shares in the RM1.9b 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

With a 13% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Ranhill Utilities Berhad. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

It seems that Private Companies own 13%, of the Ranhill Utilities 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.

Public Company Ownership

Public companies currently own 53% of Ranhill Utilities Berhad stock. 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 Ranhill Utilities Berhad better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Ranhill Utilities Berhad you should be aware of, and 1 of them is a bit unpleasant.

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.