Craftsman Automation Limited's (NSE:CRAFTSMAN) CEO Srinivasan Ravi is the most upbeat insider, and their holdings increased by 5.5% last week

Key Insights

• Insiders appear to have a vested interest in Craftsman Automation's growth, as seen by their sizeable ownership
• 53% of the business is held by the top 2 shareholders
• Institutions own 36% of Craftsman Automation

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A look at the shareholders of Craftsman Automation Limited (NSE:CRAFTSMAN) can tell us which group is most powerful. With 49% stake, individual insiders possess the maximum shares in the company. 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 5.5% gain.

In the chart below, we zoom in on the different ownership groups of Craftsman Automation.

See our latest analysis for Craftsman Automation

What Does The Institutional Ownership Tell Us About Craftsman Automation?

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.

Craftsman Automation 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. 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 Craftsman Automation, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Craftsman Automation. With a 49% stake, CEO Srinivasan Ravi is the largest shareholder. Meanwhile, the second and third largest shareholders, hold 4.2% and 4.2%, of the shares outstanding, respectively.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Craftsman Automation

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

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 information suggests that insiders maintain a significant holding in Craftsman Automation Limited. It is very interesting to see that insiders have a meaningful ₹79b stake in this ₹163b business. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 13% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Craftsman Automation better, we need to consider many other factors. For example, we've discovered 2 warning signs for Craftsman Automation (1 is a bit concerning!) that you should be aware of before investing here.

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.