Key Insights

• The considerable ownership by public companies in Genting Malaysia Berhad indicates that they collectively have a greater say in management and business strategy
• 51% of the business is held by the top 2 shareholders
• 16% of Genting Malaysia Berhad is held by Institutions

A look at the shareholders of Genting Malaysia Berhad (KLSE:GENM) can tell us which group is most powerful. The group holding the most number of shares in the company, around 49% to be precise, is public companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And individual investors on the other hand have a 34% ownership in the company.

In the chart below, we zoom in on the different ownership groups of Genting Malaysia Berhad.

View our latest analysis for Genting Malaysia Berhad

What Does The Institutional Ownership Tell Us About Genting Malaysia Berhad?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

Genting Malaysia Berhad already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Genting Malaysia Berhad, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don’t have a meaningful investment in Genting Malaysia Berhad. Genting Berhad is currently the company’s largest shareholder with 49% of shares outstanding. The second and third largest shareholders are AIA Investment Management Private Limited and The Vanguard Group, Inc., with an equal amount of shares to their name at 1.6%.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company’s shares, implying that they have considerable power to influence the company’s decisions.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Genting Malaysia Berhad

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.

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.

Our information suggests that Genting Malaysia Berhad insiders own under 1% of the company. It’s a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own RM33m worth of shares. It is good to see board members owning shares, but it might be worth checking if those insiders have been buying.

General Public Ownership

With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Genting Malaysia 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.

Public Company Ownership

We can see that public companies hold 49% of the Genting Malaysia Berhad shares on issue. It’s hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it’s worth watching this space for changes in ownership.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example – Genting Malaysia Berhad has 2 warning signs (and 1 which is potentially serious) we think you should know about.

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.