Public companies account for 50% of TVS Motor Company Limited's (NSE:TVSMOTOR) ownership, while institutions account for 33%

Key Insights

• The considerable ownership by public companies in TVS Motor indicates that they collectively have a greater say in management and business strategy
• The largest shareholder of the company is TVS Holdings Limited with a 50% stake
• Institutional ownership in TVS Motor is 33%

Every investor in TVS Motor Company Limited (NSE:TVSMOTOR) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are public companies with 50% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

Meanwhile, institutions make up 33% of the company’s shareholders. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time.

In the chart below, we zoom in on the different ownership groups of TVS Motor.

View our latest analysis for TVS Motor

What Does The Institutional Ownership Tell Us About TVS Motor?

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.

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

We note that hedge funds don't have a meaningful investment in TVS Motor. TVS Holdings Limited is currently the company's largest shareholder with 50% of shares outstanding. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 7.2% of the shares outstanding, followed by an ownership of 2.3% by the third-largest shareholder.

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 TVS Motor

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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 data suggests that insiders own under 1% of TVS Motor Company Limited in their own names. As it is a large company, we'd only expect insiders to own a small percentage of it. But it's worth noting that they own ₹83m worth of shares. Arguably recent buying and selling is just as important to consider. You can click here to see if insiders have been buying or selling.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over TVS Motor. 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

It appears to us that public companies own 50% of TVS Motor. 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:

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. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with TVS Motor (at least 1 which is a bit concerning) , and understanding them should be part of your investment process.

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.