What Kind Of Shareholder Owns Most Insecticides (India) Limited (NSE:INSECTICID) Stock?

The big shareholder groups in Insecticides (India) Limited (NSE:INSECTICID) have power over the company. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

With a market capitalization of ₹10b, Insecticides (India) is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. We can zoom in on the different ownership groups, to learn more about Insecticides (India).

See our latest analysis for Insecticides (India)

What Does The Institutional Ownership Tell Us About Insecticides (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.

We can see that Insecticides (India) does have institutional investors; and they hold 19% of the stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Insecticides (India), (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Insecticides (India). The company's CEO Rajesh Aggarwal is the largest shareholder with 40% of shares outstanding. Hari Aggarwal is the second largest shareholder with 22% of common stock, followed by HDFC Asset Management Company Limited, holding 9.2% of the stock. Interestingly, Hari Aggarwal is also a Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

Our analysis suggests that the top 2 shareholders collectively control 62% of the company's shares, implying that they have considerable power to influence the company's decisions.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Insecticides (India)

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

It seems that insiders own more than half the Insecticides (India) Limited stock. This gives them a lot of power. So they have a ₹7.0b stake in this ₹10b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 12% ownership, the general public have some degree of sway over INSECTICID. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. For example, we've discovered 3 warning signs for Insecticides (India) (1 is a bit concerning!) that you should be aware of before investing here.

Of course this may not be the best stock to buy. So take a peek at this free free list of interesting companies.

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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