Retail investors among Datasonic Group Berhad's (KLSE:DSONIC) largest stockholders and were hit after last week's 11% price drop

Key Insights

• Datasonic Group Berhad's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 10 shareholders own 52% of the company
• Insiders own 22% of Datasonic Group Berhad

A look at the shareholders of Datasonic Group Berhad (KLSE:DSONIC) can tell us which group is most powerful. With 32% stake, retail investors possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, retail investors as a group endured the highest losses last week after market cap fell by RM139m.

In the chart below, we zoom in on the different ownership groups of Datasonic Group Berhad.

Check out our latest analysis for Datasonic Group Berhad

What Does The Institutional Ownership Tell Us About Datasonic Group 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.

Datasonic Group 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Datasonic Group Berhad's historic earnings and revenue below, but keep in mind there's always more to the story.

We note that hedge funds don't have a meaningful investment in Datasonic Group Berhad. Urusharta Jamaah Sdn Bhd is currently the company's largest shareholder with 8.9% of shares outstanding. Abu Bin Noordin is the second largest shareholder owning 8.1% of common stock, and Kuantum Juang Sdn Bhd holds about 6.1% of the company stock. Abu Bin Noordin, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

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

Insider Ownership Of Datasonic Group 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 a reasonable proportion of Datasonic Group Berhad. It has a market capitalization of just RM1.1b, and insiders have RM230m worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 32% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 24%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Datasonic Group Berhad better, we need to consider many other factors. Consider risks, for instance. Every company has them, and we've spotted 1 warning sign for Datasonic Group Berhad you should know about.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.