This is what the shareholding structure of Stove Kraft Limited (NSE:STOVEKRAFT) looks like
Every investor in Stove Kraft Limited (NSE: STOVEKRAFT) should know the most powerful shareholder groups. Institutions often own shares in more established companies, while it is not uncommon to see insiders owning a good number of smaller companies. 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.
Stove Kraft is a small company with a market capitalization of ₹18 billion, so it may still fly under the radar of many institutional investors. Our analysis of societal ownership below shows that institutions own shares in society. Let’s take a closer look at what different types of shareholders can tell us about Stove Kraft.
Check out our latest analysis for Stove Kraft
What does institutional ownership tell us about Stove Kraft?
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.
We can see that Stove Kraft has institutional investors; and they own a good part of the shares of the company. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. 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 Stove Kraft’s revenue and historical earnings below, but keep in mind there’s always more to tell.
Hedge funds don’t have a lot of stock in Stove Kraft. Our data suggests that Rajendra Gandhi, who is also the company’s top executive, owns the most shares at 56%. When an insider owns a significant amount of stock in a company, investors view it as a positive sign, as it suggests that insiders are willing to tie their wealth to the future of the company. In comparison, the second and third shareholders hold approximately 4.4% and 3.8% of the shares.
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. There is a little analyst coverage of the stock, but not much. So there is room for him to gain coverage.
Insider Ownership of Stove Kraft
The definition of an insider may differ slightly from country to country, but board members still matter. Management is ultimately responsible to the board of directors. However, it is not uncommon for managers to be members of the management board, especially if they are founders or CEOs.
Insider ownership is positive when it signals that executives think like the true owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.
Our most recent data indicates that insiders own the majority of Stove Kraft Limited. This means they can collectively make decisions for the business. So they have a stake of ₹11 billion in this ₹18 billion business. Most would say this is a positive, showing strong alignment with shareholders. You can click here to see if these insiders have been buying or selling.
General public property
The general public, who are usually individual investors, hold an 18% stake in Stove Kraft. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
I find it very interesting to see who exactly owns a company. But to really get insight, we also need to consider other information. Take risks for example – Stove Kraft has 1 warning sign we think you should know.
Ultimately the future is the most important. You can access this free analyst forecast report for the company.
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.