Every investor in Indo Count Industries Limited (NSE:ICIL) should know the most powerful shareholder groups. Insiders often own a large portion of younger, smaller companies, while larger companies tend to have institutions as shareholders. Warren Buffett said he likes “a business with enduring competitive advantages that is led by capable, owner-oriented people.” So it’s nice to see some insider ownership, as it may suggest management is owner-driven.
Indo Count Industries is not a big company by world standards. It has a market capitalization of ₹32 billion, which means it would not get the attention of many institutional investors. In the chart below, we can see that institutional investors have bought the company. Let’s take a closer look at what different types of shareholders can tell us about Indo Count Industries.
Check out our latest analysis for Indo Count Industries
What does institutional ownership tell us about Indo Count Industries?
Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.
We can see that Indo Count Industries has institutional investors; and they own a good part of the shares of the company. This implies that analysts working for these institutions have reviewed the stock and like it. But like everyone else, they can be wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Indo Count Industries’ historical revenue and earnings below, but keep in mind there’s always more to tell.
Indo Count Industries is not owned by hedge funds. Sandridge Investments Ltd is currently the company’s largest shareholder with 31% of the shares outstanding. With respectively 16% and 5.2% of the outstanding shares, Margo Finance Limited and AfrAsia Bank Limited, Asset Management Arm are the second and third largest shareholders.
After digging a little deeper, we found that the top 3 shareholders collectively control more than half of the company’s stock, implying that they have considerable power to influence company decisions.
While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand a stock’s expected performance. Although there is some analyst coverage, the company is probably not widely covered. So it could attract more attention, on the track.
Insider owned by Indo Count Industries
The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
Most view insider ownership as a positive because it can indicate that the board is well aligned with other shareholders. However, there are times when too much power is concentrated within this group.
Our information suggests that insiders hold a significant stake in Indo Count Industries Limited. Insiders have a ₹3.5 billion stake in this ₹32 billion venture. This may suggest that the founders still own a lot of shares. You can click here to see if they bought or sold.
General public property
With a 29% stake, the general public, consisting mostly of individual investors, has some influence over Indo Count Industries. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
Private Company Ownership
Our data indicates that private companies hold 35% of the shares of society. It’s hard to draw conclusions from this fact alone, so it’s worth investigating who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.
Ownership of a public company
We can see that public companies hold 16% of Indo Count Industries shares outstanding. We cannot be sure, but it is quite possible that it is a strategic issue. Businesses can be similar or work together.
While it is worth considering the different groups that own a business, there are other, even more important factors. Take risks for example – Indo Count Industries has 2 warning signs we think you should know.
If you prefer to find out what analysts are predicting in terms of future growth, don’t miss this free analyst forecast report.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.