Insiders were the biggest winners as ASK Automotive Limited's (NSE:ASKAUTOLTD) market cap grew by ₹4.4b last week

Key Insights

• ASK Automotive's significant insider ownership suggests inherent interests in company's expansion
• The top 2 shareholders own 69% of the company
• Ownership research along with analyst forecasts data help provide a good understanding of opportunities in a stock

Every investor in ASK Automotive Limited (NSE:ASKAUTOLTD) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 79% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Clearly, insiders benefitted the most after the company's market cap rose by ₹4.4b last week.

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

See our latest analysis for ASK Automotive

What Does The Institutional Ownership Tell Us About ASK Automotive?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

As you can see, institutional investors have a fair amount of stake in ASK Automotive. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see ASK Automotive's historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in ASK Automotive. Vijay Rathee is currently the largest shareholder, with 35% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 34% and 4.9%, of the shares outstanding, respectively. Interestingly, the bottom two of the top three shareholders also hold the title of Chief Executive Officer and Member of the Board of Directors, respectively, suggesting that these insiders have a personal stake in the company.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of ASK Automotive

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Our information suggests that insiders own more than half of ASK Automotive Limited. This gives them effective control of the company. That means insiders have a very meaningful ₹71b stake in this ₹90b business. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

With a 14% ownership, the general public, mostly comprising of individual investors, have some degree of sway over ASK Automotive. 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. To that end, you should be aware of the 1 warning sign we've spotted with ASK Automotive .

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.