State or government who hold 73% of Hindustan Aeronautics Limited (NSE:HAL) gained 4.4%, institutions profited as well

Key Insights

• Significant control over Hindustan Aeronautics by state or government implies that the general public has more power to influence management and governance-related decisions
• 72% of the company is held by a single shareholder (India)
• Institutions own 16% of Hindustan Aeronautics

If you want to know who really controls Hindustan Aeronautics Limited (NSE:HAL), then you'll have to look at the makeup of its share registry. With 73% stake, state or government 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).

Following a 4.4% increase in the stock price last week, state or government profited the most, but institutions who own 16% stock also stood to gain from the increase.

Let's take a closer look to see what the different types of shareholders can tell us about Hindustan Aeronautics.

Check out our latest analysis for Hindustan Aeronautics

What Does The Institutional Ownership Tell Us About Hindustan Aeronautics?

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.

As you can see, institutional investors have a fair amount of stake in Hindustan Aeronautics. 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. 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 Hindustan Aeronautics' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Hindustan Aeronautics. Our data shows that India is the largest shareholder with 72% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. For context, the second largest shareholder holds about 3.4% of the shares outstanding, followed by an ownership of 1.6% by the third-largest shareholder.

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Hindustan Aeronautics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 data cannot confirm that board members are holding shares personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public, who are usually individual investors, hold a 11% stake in Hindustan Aeronautics. 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. For example, we've discovered 1 warning sign for Hindustan Aeronautics 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.