Retail investors who hold 33% of Pricol Limited (NSE:PRICOLLTD) gained 8.4%, institutions profited as well

Key Insights

• Pricol's significant retail investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 52% of the business is held by the top 10 shareholders
• Insider ownership in Pricol is 25%

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Every investor in Pricol Limited (NSE:PRICOLLTD) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 33% to be precise, is retail investors. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Following a 8.4% increase in the stock price last week, retail investors profited the most, but institutions who own 27% stock also stood to gain from the increase.

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

See our latest analysis for Pricol

What Does The Institutional Ownership Tell Us About Pricol?

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.

We can see that Pricol does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Pricol's earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Pricol. Pricol Holdings Limited is currently the largest shareholder, with 9.0% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 8.6% and 6.3%, of the shares outstanding, respectively. Vikram Mohan, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

We did some more digging and found that 10 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. While there is some analyst coverage, the company is probably not widely covered. So it could gain more attention, down the track.

Insider Ownership Of Pricol

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.

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 Pricol Limited. Insiders own ₹14b worth of shares in the ₹57b company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 33% stake in Pricol. 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 13%, 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

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.