Key Insights
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Significant control over NCT Alliance Berhad by private companies implies that the general public has more power to influence management and governance-related decisions
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A total of 3 investors have a majority stake in the company with 51% ownership
To get a sense of who is truly in control of NCT Alliance Berhad ( KLSE:NCT ), it is important to understand the ownership structure of the business. With 55% stake, private companies possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).
And individual investors on the other hand have a 25% ownership in the company.
Let's delve deeper into each type of owner of NCT Alliance Berhad, beginning with the chart below.
View our latest analysis for NCT Alliance Berhad
What Does The Institutional Ownership Tell Us About NCT Alliance 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 NCT Alliance 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 NCT Alliance Berhad's historic earnings and revenue below, but keep in mind there's always more to the story.
We note that hedge funds don't have a meaningful investment in NCT Alliance Berhad. YBG Yap Consolidated Sdn. Bhd. is currently the company's largest shareholder with 42% of shares outstanding. For context, the second largest shareholder holds about 4.5% of the shares outstanding, followed by an ownership of 4.1% by the third-largest shareholder. Fook Yap, who is the second-largest shareholder, also happens to hold the title of Senior Key Executive. In addition, we found that Ngan Yap, the CEO has 3.9% of the shares allocated to their name.
A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.
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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of NCT Alliance Berhad
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 a reasonable proportion of NCT Alliance Berhad. Insiders own RM164m worth of shares in the RM1.2b company. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. 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 25% stake in NCT Alliance 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
We can see that Private Companies own 55%, of the shares on issue. 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:
While it is well worth considering the different groups that own a company, there are other factors that are even more important.
I like to dive deeperinto how a company has performed in the past. You can find historic revenue and earnings in this detailed graph .
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.
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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.
