Retail investors invested in Electrovaya Inc. (TSE:ELVA) up 11% last week, insiders too were rewarded

Key Insights

• The considerable ownership by retail investors in Electrovaya indicates that they collectively have a greater say in management and business strategy
• 50% of the business is held by the top 13 shareholders
• Insider ownership in Electrovaya is 34%

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Every investor in Electrovaya Inc. (TSE:ELVA) should be aware of the most powerful shareholder groups. With 49% stake, retail investors possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 11% increase in the stock price last week, retail investors profited the most, but insiders who own 34% stock also stood to gain from the increase.

Let's delve deeper into each type of owner of Electrovaya, beginning with the chart below.

View our latest analysis for Electrovaya

What Does The Institutional Ownership Tell Us About Electrovaya?

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.

Electrovaya already has institutions on the share registry. Indeed, they own a respectable stake in the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Electrovaya's earnings history below. Of course, the future is what really matters.

It would appear that 5.4% of Electrovaya shares are controlled by hedge funds. That's interesting, because hedge funds can be quite active and activist. Many look for medium term catalysts that will drive the share price higher. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Electrovaya's case, its Top Key Executive, Sankar Gupta, is the largest shareholder, holding 26% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 5.4% and 4.7%, of the shares outstanding, respectively. Additionally, the company's CEO Rajshekar Gupta directly holds 1.7% of the total shares outstanding.

A closer look at our ownership figures suggests that the top 13 shareholders have a combined ownership of 50% implying that no single shareholder has a majority.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Electrovaya

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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.

Our most recent data indicates that insiders own a reasonable proportion of Electrovaya Inc.. Insiders have a CA$114m stake in this CA$335m 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 49% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Electrovaya. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

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. Be aware that Electrovaya is showing 3 warning signs in our investment analysis , and 2 of those are concerning...

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.