Following recent decline, KNR Constructions Limited's (NSE:KNRCON) top shareholder CEO Kamidi Reddy sees holdings value drop by 7.0%

Key Insights

• KNR Constructions' significant insider ownership suggests inherent interests in company's expansion
• A total of 3 investors have a majority stake in the company with 52% ownership
• Institutional ownership in KNR Constructions is 39%

If you want to know who really controls KNR Constructions Limited (NSE:KNRCON), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 49% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 7.0% decline in share price, insiders suffered the most losses.

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

View our latest analysis for KNR Constructions

What Does The Institutional Ownership Tell Us About KNR Constructions?

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.

We can see that KNR Constructions does have institutional investors; and they hold a good portion of the company's stock. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see KNR Constructions' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in KNR Constructions. Looking at our data, we can see that the largest shareholder is the CEO Kamidi Reddy with 30% of shares outstanding. With 13% and 8.2% of the shares outstanding respectively, Kamidi Reddy and HDFC Asset Management Company Limited are the second and third largest shareholders. Interestingly, the second-largest shareholder, Kamidi Reddy is also Chief Financial Officer, again, pointing towards strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 52% stake.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of KNR Constructions

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.

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 KNR Constructions Limited. It is very interesting to see that insiders have a meaningful ₹44b stake in this ₹91b 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 12% stake in KNR Constructions. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that KNR Constructions is showing 2 warning signs in our investment analysis , you should know about...

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.