Individual investors invested in Bukit Sembawang Estates Limited (SGX:B61) copped the brunt of last week's S$80m market cap decline

Key Insights

• Significant control over Bukit Sembawang Estates by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 16 shareholders own 49% of the company
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Bukit Sembawang Estates Limited (SGX:B61) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 50% to be precise, is individual investors. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, individual investors as a group endured the highest losses last week after market cap fell by S$80m.

Let's delve deeper into each type of owner of Bukit Sembawang Estates, beginning with the chart below.

See our latest analysis for Bukit Sembawang Estates

What Does The Institutional Ownership Tell Us About Bukit Sembawang Estates?

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 Bukit Sembawang Estates. 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 Bukit Sembawang Estates' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Bukit Sembawang Estates. The company's largest shareholder is Selat (Pte) Limited, with ownership of 29%. Meanwhile, the second and third largest shareholders, hold 8.5% and 4.6%, of the shares outstanding, respectively.

Our studies suggest that the top 16 shareholders collectively control less than half of the company's shares, meaning that the company's shares are widely disseminated and there is no dominant shareholder.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Bukit Sembawang Estates

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

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 most recent data indicates that insiders own less than 1% of Bukit Sembawang Estates Limited. 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 S$5.4m worth of shares in the S$847m company. We generally like to see a board more invested. However it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, mostly comprising of individual investors, collectively holds 50% of Bukit Sembawang Estates shares. This size of ownership gives investors from the general public some collective power. They can and probably do influence decisions on executive compensation, dividend policies and proposed business acquisitions.

Private Company Ownership

Our data indicates that Private Companies hold 43%, 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. Case in point: We've spotted 2 warning signs for Bukit Sembawang Estates you should be aware of, and 1 of them makes us a bit uncomfortable.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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