Private companies among Steel Exchange India Limited's (NSE:STEELXIND) largest shareholders, saw gain in holdings value after stock jumped 17% last week
Key Insights
- Steel Exchange India's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
- The top 5 shareholders own 51% of the company
- 11% of Steel Exchange India is held by insiders
A look at the shareholders of Steel Exchange India Limited (NSE:STEELXIND) can tell us which group is most powerful. We can see that private companies own the lion's share in the company with 53% ownership. Put another way, the group faces the maximum upside potential (or downside risk).
Clearly, private companies benefitted the most after the company's market cap rose by ₹1.7b last week.
Let's delve deeper into each type of owner of Steel Exchange India, beginning with the chart below.
See our latest analysis for Steel Exchange India
What Does The Institutional Ownership Tell Us About Steel Exchange India?
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.
Less than 5% of Steel Exchange India 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 business gets stronger from here, we could see a situation where more institutions are keen to buy. 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.
Steel Exchange India is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is Umashiv Garments Private Limited with 20% of shares outstanding. In comparison, the second and third largest shareholders hold about 20% and 4.8% of the stock. Furthermore, CEO Bandi Kumar is the owner of 0.5% of the company's shares.
Our research also brought to light the fact that roughly 51% of the company is controlled by the top 5 shareholders suggesting that these owners wield significant influence on the business.
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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Steel Exchange India
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.
Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.
It seems insiders own a significant proportion of Steel Exchange India Limited. Insiders have a ₹1.3b stake in this ₹12b business. 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
With a 34% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Steel Exchange India. 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
It seems that Private Companies own 53%, of the Steel Exchange India stock. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.
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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with Steel Exchange India (at least 1 which is a bit concerning) , and understanding them should be part of your investment process.
Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.
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.