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The considerable ownership by individual investors in V.S. Industry Berhad indicates that they collectively have a greater say in management and business strategy
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The top 10 shareholders own 51% of the company
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Insiders own 28% of V.S. Industry Berhad
Every investor in V.S. Industry Berhad (KLSE:VS) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 38% to be precise, is individual investors. Put another way, the group faces the maximum upside potential (or downside risk).
And institutions on the other hand have a 34% ownership in the company. Institutions often own shares in more established companies, while it’s not unusual to see insiders own a fair bit of smaller companies.
Let’s take a closer look to see what the different types of shareholders can tell us about V.S. Industry Berhad.
See our latest analysis for V.S. Industry Berhad
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it’s included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.
As you can see, institutional investors have a fair amount of stake in V.S. Industry Berhad. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 V.S. Industry Berhad’s earnings history below. Of course, the future is what really matters.
Hedge funds don’t have many shares in V.S. Industry Berhad. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In V.S. Industry Berhad’s case, its Top Key Executive, Kim Beh, is the largest shareholder, holding 15% of shares outstanding. Employees Provident Fund of Malaysia is the second largest shareholder owning 8.7% of common stock, and Kumpulan Wang Persaraan holds about 4.9% of the company stock. Additionally, the company’s CEO Sem Gan directly holds 4.9% of the total shares outstanding.
On further inspection, we found that more than half the company’s shares are owned by the top 10 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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.
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.
It seems insiders own a significant proportion of V.S. Industry Berhad. It is very interesting to see that insiders have a meaningful RM1.3b stake in this RM4.5b business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.
The general public, who are usually individual investors, hold a 38% stake in V.S. Industry 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.
It’s always worth thinking about the different groups who own shares in a company. But to understand V.S. Industry Berhad better, we need to consider many other factors.
Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.
But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.
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.
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