KUALA LUMPUR: Three major shareholders of CTOS Digital Bhd have collectively disposed of nearly 22 million shares since Sept 23, when the credit reporting agency disclosed a cybersecurity breach that has since sent its share price tumbling.
Bursa Malaysia filings showed that the Employees Provident Fund (EPF), Retirement Fund Inc (KWAP) and Aberdeen Group plc have reported only disposals, with no acquisitions, during the period.
CTOS shares fell 15.29 per cent, or 6.5 sen, to close at a fresh record low of 36 sen today, after hitting an intraday low of 35.5 sen.
The latest decline brings the stock's cumulative loss to 44.19 per cent from its Sept 22 closing price of 64.5 sen, the last trading day before the cybersecurity disclosure.
CTOS was the eighth most actively traded counter on Bursa Malaysia, with 29.39 million shares changing hands, its highest daily trading volume in over three months.
Of the three institutional shareholders, KWAP recorded the largest reduction in its holdings, followed by EPF and Aberdeen.
KWAP's latest disposal involved 1.77 million shares on Oct 16, reducing its stake to 191.81 million shares, or 8.724 per cent. Its holdings have declined by about 10.99 million shares since Sept 25.
EPF, meanwhile, disposed of 1.31 million shares on Oct 14, bringing its holdings to 449.10 million shares, or 20.43 per cent. Its holdings have fallen by about 6.38 million shares since Sept 23.
Aberdeen's latest reported disposal involved 384,000 shares on Oct 14, leaving it with 325.22 million shares, representing a 14.79 per cent stake. Its holdings have declined by about 4.20 million shares since Sept 25.
The combined reduction of about 21.57 million shares represents roughly one per cent of CTOS's issued share capital.
Meanwhile, CTOS itself bought back 500,000 shares at 61 sen apiece on Sept 25, two days after disclosing the cybersecurity breach, for an estimated RM305,000.
The stock has since fallen nearly 41 per cent from that repurchase price to today's closing price of 36 sen.
CTOS first disclosed the breach on Sept 23, saying unauthorised access had been detected in an environment supporting its consumer business.
The company said certain files containing a limited subset of processed consumer information had been accessed, although the incident had been contained and other systems were unaffected.
At the time, CTOS said the breach was not expected to have a material financial impact.
However, on Oct 13, the company estimated that the disruption would reduce its profit after tax and minority interests by RM12 million and revenue by RM16 million for the financial year ending Dec 31, 2026.
The estimates assumed that certain affected services, including CTOS Score and Central Credit Reference Information System-related reports, would remain unavailable until the third week of October.
CTOS also estimated that every additional week of disruption could reduce profit by RM1.3 million and revenue by RM2.5 million.
This has prompted several research houses to downgrade the stock and lower their earnings forecasts.
Hong Leong Investment Bank Bhd and CIMB Securities Sdn Bhd downgraded CTOS to "Hold" from "Buy", while Kenanga Research lowered its recommendation to "Market Perform" from "Outperform".
Kenanga adopted a more conservative assumption that the affected services could remain unavailable until the end of December, potentially raising the profit impact to RM22 million.
RHB Research, however, maintained its "Buy" recommendation, arguing that the sell-off had been excessive given CTOS's established position in the credit reporting industry.
Analysts have also raised concerns that restoring the affected services may not immediately translate into a recovery in transaction volumes, with potential customer migration and higher cybersecurity spending posing risks to future earnings.
The sharp decline in CTOS shares has also coincided with the appointment of Putri Norlisa Najib, the daughter of former prime minister Datuk Seri Najib Razak, as an independent non-executive director.
The stock gained one sen to close at 64.5 sen a day after her appointment was announced on Sept 21, before beginning its decline.
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