What Is BHD (Berhad)?

BHD is a suffix for Berhad, which is used in Malaysia to identify a public limited company. Berhad, BHD, or Bhd after a company’s name indicates that it is a Malaysian public limited company (PLC) while the extended suffix Sendirian Berhad (SDN BHD) denotes that it is a private limited company.

Key Takeaways

  • Berhad (BHD) is a suffix used in Malaysia to identify a public limited company. The suffix Sendirian Berhad (SDN BHD) identifies a private limited company.
  • SDN BHD companies are typically small or midsized enterprises. BHD companies are the largest companies in Malaysia.
  • BHD companies have stricter financial reporting standards than SDN BHD companies because they must disclose their financial statements to the public.
  • Although most BHD companies list their shares and trade on a stock market, they can choose to stay unlisted.

Share Issue and BHD

Both BHD and SDN BHD companies are classified as those that issue shares, which is the most common type of business entity in Malaysia. Such companies have a limited number of shares, and the liability of their shareholders is restricted to the amount specified on their unpaid shares.

Other types of companies in Malaysia are companies limited by guarantees, such as nonprofit organizations, public societies, and unlimited liability corporations (ULC).

BHD Versus SDN BHD

A BHD company must have a minimum of two shareholders, and the maximum is unlimited; an SDN BHD company can have two to 50 shareholders. SDN BHD companies are typically small or midsized enterprises (SME) while BHD companies are the largest companies in Malaysia. BHD companies have stricter financial reporting standards than SDN BHD companies because they must disclose their financial statements to the public. BHD firms also have greater access to capital than SDN BHD companies because they can access public equity and debt financing when they require funding. 

Although the process of incorporation for both types of companies is substantially similar, an SDN BHD company has some stringent stipulations in its Articles of Association. These include restrictions on transfers of the company’s shares, a maximum of 50 shareholders, a prohibition on public subscriptions to the company’s shares or debentures, and on collecting public deposits. Although most BHD companies list their shares and trade on a stock market, it is not a mandatory requirement. Therefore, they can choose to stay unlisted.

Real-World Example

In 2018, the Forbes Global 2000 list included 13 Malaysian BHD companies. According to the Forbes ranking—which is based on a combination of sales, profits, assets, and market value—the largest companies in Malaysia include:

  1. Maybank Bhd (#394)
  2. Tenaga Nasional Bhd (#503)
  3. CIMB Group Holdings Bhd (#620)
  4. Public Bank Bhd (#646)
  5. Petronas Chemicals Group Bhd (#1268)
  6. RHB Bank Bhd (#1448)
  7. Axiata Group Bhd (#1508)
  8. Sime Darby Bhd (#1535)
  9. Hong Leong Financial Group Bhd (#1568)
  10. Sime Darby Plantation Bhd (#1624)
  11. Maxis Bhd (#1779)
  12. Genting Bhd (#1811)
  13. AmBank Group Bhd (#1911)