Bank of Baroda Limited's (NSE:BANKBARODA) largest shareholders are state or government with 64% ownership, institutions own 23%

Key Insights

• Significant control over Bank of Baroda by state or government implies that the general public has more power to influence management and governance-related decisions
• The largest shareholder of the company is India with a 64% stake
• 23% of Bank of Baroda is held by Institutions

Every investor in Bank of Baroda Limited (NSE:BANKBARODA) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 64% to be precise, is state or government. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Meanwhile, institutions make up 23% of the company’s shareholders. Institutions often own shares in more established companies, while it's not unusual to see insiders own a fair bit of smaller companies.

In the chart below, we zoom in on the different ownership groups of Bank of Baroda.

Check out our latest analysis for Bank of Baroda

What Does The Institutional Ownership Tell Us About Bank of Baroda?

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.

Bank of Baroda 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. 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 Bank of Baroda, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Bank of Baroda. India is currently the company's largest shareholder with 64% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Meanwhile, the second and third largest shareholders, hold 5.0% and 3.3%, of the shares outstanding, respectively.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Bank of Baroda

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 less than 1% of Bank of Baroda Limited. 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 ₹4.2m 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

The general public, who are usually individual investors, hold a 13% stake in Bank of Baroda. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Bank of Baroda better, we need to consider many other factors. For instance, we've identified 1 warning sign for Bank of Baroda that you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter future.

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.