Private companies own 41% of Paramount Corporation Berhad (KLSE:PARAMON) shares but retail investors control 43% of the company
editorial-team@simplywallst.com (Simply Wall St)
4 min read
Key Insights
The considerable ownership by retail investors in Paramount Corporation Berhad indicates that they collectively have a greater say in management and business strategy
51% of the business is held by the top 10 shareholders
Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock
If you want to know who really controls Paramount Corporation Berhad (KLSE:PARAMON), then you'll have to look at the makeup of its share registry. We can see that retail investors own the lion's share in the company with 43% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Meanwhile, private companies make up 41% of the company’s shareholders.
Let's delve deeper into each type of owner of Paramount Corporation Berhad, beginning with the chart below.
KLSE:PARAMON Ownership Breakdown November 6th 2023
What Does The Institutional Ownership Tell Us About Paramount Corporation 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.
Less than 5% of Paramount Corporation Berhad is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.
KLSE:PARAMON Earnings and Revenue Growth November 6th 2023
Hedge funds don't have many shares in Paramount Corporation Berhad. Our data shows that Paramount Equities Sdn Bhd is the largest shareholder with 25% of shares outstanding. For context, the second largest shareholder holds about 8.4% of the shares outstanding, followed by an ownership of 4.3% by the third-largest shareholder. Furthermore, CEO Sun Teong Chew is the owner of 1.5% of the company's shares.
We also observed that the top 10 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.
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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.
Insider Ownership Of Paramount Corporation Berhad
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
Shareholders would probably be interested to learn that insiders own shares in Paramount Corporation Berhad. It has a market capitalization of just RM579m, and insiders have RM44m worth of shares, in their own names. This shows at least some alignment, but we usually like to see larger insider holdings. 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 43% stake in Paramount Corporation Berhad. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.
Private Company Ownership
We can see that Private Companies own 41%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.
Public Company Ownership
We can see that public companies hold 4.3% of the Paramount Corporation Berhad shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.
Next Steps:
I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Take risks for example - Paramount Corporation Berhad has 2 warning signs (and 1 which is a bit concerning) we think you should know about.
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.
Have feedback on this article? Concerned about the content?Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
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.
