The recent 6.6% gain must have brightened Co-Chief Executive Officer Rajiv Poddar's week, Balkrishna Industries Limited's (NSE:BALKRISIND) most bullish insider

Key Insights

• Insiders appear to have a vested interest in Balkrishna Industries' growth, as seen by their sizeable ownership
• 53% of the business is held by the top 2 shareholders
• Institutions own 29% of Balkrishna Industries

Every investor in Balkrishna Industries Limited (NSE:BALKRISIND) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 33% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders scored the highest last week as the company hit ₹619b market cap following a 6.6% gain in the stock.

Let's take a closer look to see what the different types of shareholders can tell us about Balkrishna Industries.

Check out our latest analysis for Balkrishna Industries

What Does The Institutional Ownership Tell Us About Balkrishna Industries?

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.

As you can see, institutional investors have a fair amount of stake in Balkrishna Industries. 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 Balkrishna Industries' earnings history below. Of course, the future is what really matters.

Balkrishna Industries is not owned by hedge funds. From our data, we infer that the largest shareholder is Rajiv Poddar (who also holds the title of Co-Chief Executive Officer) with 28% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. Meanwhile, the second and third largest shareholders, hold 25% and 3.9%, of the shares outstanding, respectively. Interestingly, the third-largest shareholder, Arvind Kumar Poddar is also a Chairman of the Board, again, indicating strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 53% stake.

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 Balkrishna Industries

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.

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.

It seems insiders own a significant proportion of Balkrishna Industries Limited. It has a market capitalization of just ₹619b, and insiders have ₹205b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public-- including retail investors -- own 12% stake in the company, and hence can't easily be ignored. 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.

Private Company Ownership

Our data indicates that Private Companies hold 25%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. Case in point: We've spotted 1 warning sign for Balkrishna Industries you should be aware of.

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.