Srinivasan Ravi Craftsman Automation Limited's (NSE:CRAFTSMAN) CEO is the most bullish insider, and their stock value gained 7.8%last week

Key Insights

• Craftsman Automation's significant insider ownership suggests inherent interests in company's expansion
• 53% of the business is held by the top 2 shareholders
• 33% of Craftsman Automation is held by Institutions

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If you want to know who really controls Craftsman Automation Limited (NSE:CRAFTSMAN), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 49% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders scored the highest last week as the company hit ₹153b market cap following a 7.8% gain in the stock.

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

Check out our latest analysis for Craftsman Automation

What Does The Institutional Ownership Tell Us About Craftsman Automation?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

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.

We note that hedge funds don't have a meaningful investment in Craftsman Automation. Looking at our data, we can see that the largest shareholder is the CEO Srinivasan Ravi with 49% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.5% and 4.2%, of the shares outstanding, respectively.

To make our study more interesting, we found that the top 2 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 Craftsman Automation

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

Our most recent data indicates that insiders own a reasonable proportion of Craftsman Automation Limited. It is very interesting to see that insiders have a meaningful ₹74b stake in this ₹153b 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, who are usually individual investors, hold a 16% stake in Craftsman Automation. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should learn about the 3 warning signs we've spotted with Craftsman Automation (including 2 which don't sit too well with us) .

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.