Data Patterns (India) Limited's (NSE:DATAPATTNS) CEO Srinivasagopalan Rangarajan is the most upbeat insider, and their holdings increased by 5.7% last week

Key Insights

• Data Patterns (India)'s significant insider ownership suggests inherent interests in company's expansion
• A total of 4 investors have a majority stake in the company with 51% ownership
• 18% of Data Patterns (India) is held by Institutions

To get a sense of who is truly in control of Data Patterns (India) Limited (NSE:DATAPATTNS), it is important to understand the ownership structure of the business. We can see that individual insiders own the lion's share in the company with 55% ownership. 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 5.7% gain.

In the chart below, we zoom in on the different ownership groups of Data Patterns (India).

Check out our latest analysis for Data Patterns (India)

What Does The Institutional Ownership Tell Us About Data Patterns (India)?

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.

Data Patterns (India) already has institutions on the share registry. Indeed, they own a respectable stake in the company. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Data Patterns (India), (below). Of course, keep in mind that there are other factors to consider, too.

Data Patterns (India) is not owned by hedge funds. The company's CEO Srinivasagopalan Rangarajan is the largest shareholder with 23% of shares outstanding. Rekha Rangarajan is the second largest shareholder owning 19% of common stock, and Singapore holds about 6.4% of the company stock. Interestingly, the second-largest shareholder, Rekha Rangarajan is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

On looking further, we found that 51% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 Data Patterns (India)

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. 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.

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 information suggests that insiders own more than half of Data Patterns (India) Limited. This gives them effective control of the company. That means insiders have a very meaningful ₹75b stake in this ₹136b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public-- including retail investors -- own 19% 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:

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. Be aware that Data Patterns (India) is showing 2 warning signs in our investment analysis , and 1 of those shouldn't be ignored...

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.