Stock Analysis

GRP Limited's (NSE:GRPLTD) largest shareholder, CEO Harsh Gandhi sees holdings value fall by 10% following recent drop

NSEI:GRPLTD
Source: Shutterstock

Key Insights

  • Significant insider control over GRP implies vested interests in company growth
  • The top 13 shareholders own 51% of the company
  • Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

If you want to know who really controls GRP Limited (NSE:GRPLTD), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 57% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, insiders endured the biggest losses as the stock fell by 10%.

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

Check out our latest analysis for GRP

ownership-breakdown
NSEI:GRPLTD Ownership Breakdown January 14th 2025

What Does The Institutional Ownership Tell Us About GRP?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

Since institutions own only a small portion of GRP, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

earnings-and-revenue-growth
NSEI:GRPLTD Earnings and Revenue Growth January 14th 2025

We note that hedge funds don't have a meaningful investment in GRP. With a 7.5% stake, CEO Harsh Gandhi is the largest shareholder. For context, the second largest shareholder holds about 6.3% of the shares outstanding, followed by an ownership of 6.1% by the third-largest shareholder. Interestingly, the second-largest shareholder, Rajendra Gandhi is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

After doing some more digging, we found that the top 13 have the combined ownership of 51% in the company, suggesting that no single shareholder has significant control over 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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of GRP

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

Our information suggests that insiders own more than half of GRP Limited. This gives them effective control of the company. That means they own ₹9.2b worth of shares in the ₹16b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

With a 35% ownership, the general public, mostly comprising of individual investors, have some degree of sway over GRP. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 3.9%, of the shares on issue. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand GRP better, we need to consider many other factors. To that end, you should be aware of the 2 warning signs we've spotted with GRP .

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.

New: Manage All Your Stock Portfolios in One Place

We've created the ultimate portfolio companion for stock investors, and it's free.

• Connect an unlimited number of Portfolios and see your total in one currency
• Be alerted to new Warning Signs or Risks via email or mobile
• Track the Fair Value of your stocks

Try a Demo Portfolio for Free

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.