Insiders the biggest winners as Ahluwalia Contracts (India) Limited's (NSE:AHLUCONT) market cap rises to ₹61b

Key Insights

• Significant insider control over Ahluwalia Contracts (India) implies vested interests in company growth
• 56% of the business is held by the top 3 shareholders
• 25% of Ahluwalia Contracts (India) is held by Institutions

We've discovered 1 warning sign about Ahluwalia Contracts (India). View them for free.

A look at the shareholders of Ahluwalia Contracts (India) Limited (NSE:AHLUCONT) can tell us which group is most powerful. The group holding the most number of shares in the company, around 55% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 10% gain.

Let's delve deeper into each type of owner of Ahluwalia Contracts (India), beginning with the chart below.

View our latest analysis for Ahluwalia Contracts (India)

What Does The Institutional Ownership Tell Us About Ahluwalia Contracts (India)?

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.

Ahluwalia Contracts (India) 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 Ahluwalia Contracts (India)'s earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Ahluwalia Contracts (India). Our data shows that Sudarshan Walia is the largest shareholder with 31% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 16% and 9.2%, of the shares outstanding, respectively. Bikramjit Ahluwalia, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

To make our study more interesting, we found that the top 3 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Ahluwalia Contracts (India)

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

It seems that insiders own more than half the Ahluwalia Contracts (India) Limited stock. This gives them a lot of power. So they have a ₹34b stake in this ₹61b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 10% stake in Ahluwalia Contracts (India). While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Equity Ownership

With an ownership of 9.2%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Some might like this, because private equity are sometimes activists who hold management accountable. But other times, private equity is selling out, having taking the company public.

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 1 warning sign with Ahluwalia Contracts (India) , 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.