Institutions along with private companies who hold considerable shares inMalaysian Pacific Industries Berhad (KLSE:MPI) come under pressure; lose 7.8% of holdings value

Key Insights

• The considerable ownership by private companies in Malaysian Pacific Industries Berhad indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is Hong Leong Company (Malaysia) Berhad (Hlcm) with a 58% stake
• Institutional ownership in Malaysian Pacific Industries Berhad is 30%

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To get a sense of who is truly in control of Malaysian Pacific Industries Berhad (KLSE:MPI), it is important to understand the ownership structure of the business. With 58% stake, private companies possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 7.8% decrease in the stock price last week, private companies suffered the most losses, but institutions who own 30% stock also took a hit.

Let's delve deeper into each type of owner of Malaysian Pacific Industries Berhad, beginning with the chart below.

See our latest analysis for Malaysian Pacific Industries Berhad

What Does The Institutional Ownership Tell Us About Malaysian Pacific Industries 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 Malaysian Pacific Industries 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 Malaysian Pacific Industries Berhad's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Malaysian Pacific Industries Berhad. The company's largest shareholder is Hong Leong Company (Malaysia) Berhad (Hlcm), with ownership of 58%. With such a huge stake in the ownership, we infer that they have significant control of the future of the company. Meanwhile, the second and third largest shareholders, hold 12% and 2.9%, of the shares outstanding, respectively.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Malaysian Pacific Industries 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. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 some shares in Malaysian Pacific Industries Berhad. This is a big company, so it is good to see this level of alignment. Insiders own RM93m worth of shares (at current prices). Most would say this shows alignment of interests between shareholders and the board. Still, it might be worth checking if those insiders have been selling.

General Public Ownership

With a 10% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Malaysian Pacific Industries 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

It seems that Private Companies own 58%, of the Malaysian Pacific Industries Berhad stock. 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.

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.

I always like to check for a history of revenue growth. You can too, by accessing this free chart of historic revenue and earnings in this detailed graph.

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.