Here's What Rane Holdings Limited's (NSE:RANEHOLDIN) Shareholder Ownership Structure Looks Like

A look at the shareholders of Rane Holdings Limited (NSE:RANEHOLDIN) can tell us which group is most powerful. Large companies usually have institutions as shareholders, and we usually see insiders owning shares in smaller companies. Warren Buffett said that he likes "a business with enduring competitive advantages that is run by able and owner-oriented people." So it's nice to see some insider ownership, because it may suggest that management is owner-oriented.

With a market capitalization of ₹9.3b, Rane Holdings is a small cap stock, so it might not be well known by many institutional investors. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. Let's take a closer look to see what the different types of shareholders can tell us about Rane Holdings.

Check out our latest analysis for Rane Holdings

What Does The Institutional Ownership Tell Us About Rane Holdings?

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.

We can see that Rane Holdings does have institutional investors; and they hold a good portion of the company's stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Rane Holdings, (below). Of course, keep in mind that there are other factors to consider, too.

Rane Holdings is not owned by hedge funds. Lakshman Lakshminarayan is currently the largest shareholder, with 11% of shares outstanding. T.G.G. Raman is the second largest shareholder owning 10% of common stock, and Lakshminarayan Ganesh holds about 8.5% of the company stock. Lakshminarayan Ganesh, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

We did some more digging and found that 8 of the top shareholders account for roughly 53% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Rane Holdings

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

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 most recent data indicates that insiders own a reasonable proportion of Rane Holdings Limited. Insiders have a ₹4.2b stake in this ₹9.3b business. I would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, with a 30% stake in the company, will not 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.

Public Company Ownership

We can see that public companies hold 3.8% of the Rane Holdings shares on issue. This may be a strategic interest and the two companies may have related business interests. It could be that they have de-merged. This holding is probably worth investigating further.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Rane Holdings better, we need to consider many other factors. Like risks, for instance. Every company has them, and we've spotted 4 warning signs for Rane Holdings (of which 1 is a bit unpleasant!) you should know about.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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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