Despite recent sales, G N A Axles Limited (NSE:GNA) insiders own 68% shares but recent downturn may have set them back

By
Simply Wall St
Published
January 26, 2022
NSEI:GNA
Source: Shutterstock

To get a sense of who is truly in control of G N A Axles Limited (NSE:GNA), it is important to understand the ownership structure of the business. With 68% stake, individual insiders 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).

Even though insiders have sold shares recently, the group owns the most numbers of shares in the company. Following last week's 10% decline in share price, the group also suffered the most losses.

Let's delve deeper into each type of owner of G N A Axles, beginning with the chart below.

Check out our latest analysis for G N A Axles

ownership-breakdown
NSEI:GNA Ownership Breakdown January 26th 2022

What Does The Institutional Ownership Tell Us About G N A Axles?

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.

G N A Axles already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. 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 G N A Axles' earnings history below. Of course, the future is what really matters.

earnings-and-revenue-growth
NSEI:GNA Earnings and Revenue Growth January 26th 2022

G N A Axles is not owned by hedge funds. Gurdeep Cheema is currently the largest shareholder, with 16% of shares outstanding. With 15% and 15% of the shares outstanding respectively, Jasvinder Seehra and Ranbir Seehra are the second and third largest shareholders. Two of the top three shareholders happen to be Senior Key Executive and Member of the Board of Directors, respectively. That is, insiders feature higher up in the heirarchy of the company's top shareholders.

On looking further, we found that 57% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of G N A Axles

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 most recent data indicates that insiders own the majority of G N A Axles Limited. This means they can collectively make decisions for the company. That means they own ₹7.8b worth of shares in the ₹12b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 21% stake in G N A Axles. 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 3 warning signs we've spotted with G N A Axles .

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this 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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