How to calculate the indirect shareholding ratio

Mondo Finance Updated on 2024-01-30

Indirect shareholding ratio refers to the proportion of shares held by investors in a listed company by holding shares in other companies or institutions. Calculating the indirect shareholding ratio needs to take into account the number of shares held by the investor in other companies or institutions and the number of shares of listed companies held by those companies or institutions.

In order to calculate indirect shareholdings, we need to first understand the number of shares held by the investor in other companies or institutions. This can be obtained by reviewing investor disclosures of shareholding information or relevant announcements. For example, if an investor holds 5% of a company's shares, then that investor indirectly holds a stake in the company's parent company.

Next, we need to understand the number of shares held by these companies or institutions in public companies. This can be obtained by consulting relevant announcements or publicly available information. For example, if the company's parent company holds 10% of the shares of the listed company, then the investor indirectly holds 10% of the shares of the listed company.

Multiply these two numbers to get the investor's indirect shareholding. For example, if an investor holds 5% of the shares of another company or institution, which in turn holds 10% of the shares of a listed company, then the investor indirectly holds 50% of the shares of the listed company.

It is important to note that this is just a simple calculation method, and the actual situation may be more complicated. For example, calculating indirect shareholdings is more complicated if an investor holds shares in other companies or institutions through multiple channels, or if other investors also hold those shares. Therefore, it is necessary to take into account various factors when making calculations and to obtain as accurate data and information as possible.

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