Graphjet Technology's (NASDAQ:GTI) most bullish insider, Chief Scientific Officer Yun Liu must be pleased with the recent 33% gain

Key Insights

• Graphjet Technology's significant insider ownership suggests inherent interests in company's expansion
• A total of 3 investors have a majority stake in the company with 58% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

A look at the shareholders of Graphjet Technology (NASDAQ:GTI) can tell us which group is most powerful. The group holding the most number of shares in the company, around 53% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders scored the highest last week as the company hit US$280m market cap following a 33% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Graphjet Technology.

View our latest analysis for Graphjet Technology

What Does The Lack Of Institutional Ownership Tell Us About Graphjet Technology?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. Graphjet Technology might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

Graphjet Technology is not owned by hedge funds. From our data, we infer that the largest shareholder is Yun Liu (who also holds the title of Chief Scientific Officer) with 25% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. With 19% and 14% of the shares outstanding respectively, Suria Suskes Engineering Sdn Bhd and Hooi Lim are the second and third largest shareholders. Interestingly, the third-largest shareholder, Hooi Lim is also a Chairman of the Board, again, indicating strong insider ownership amongst the company's top shareholders. Additionally, the company's CEO Ping Wei Lee directly holds 6.1% of the total shares outstanding.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Graphjet Technology

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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 information suggests that insiders own more than half of Graphjet Technology. This gives them effective control of the company. So they have a US$148m stake in this US$280m business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 28% stake in Graphjet Technology. 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

Our data indicates that Private Companies hold 19%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 5 warning signs we've spotted with Graphjet Technology .

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.