Retail investors invested in Salasar Techno Engineering Limited (NSE:SALASAR) copped the brunt of last week's ₹2.0b market cap decline

Key Insights

• Significant control over Salasar Techno Engineering by retail investors implies that the general public has more power to influence management and governance-related decisions
• A total of 8 investors have a majority stake in the company with 52% ownership
• Recent sales by insiders

A look at the shareholders of Salasar Techno Engineering Limited (NSE:SALASAR) can tell us which group is most powerful. The group holding the most number of shares in the company, around 33% to be precise, is retail investors. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, retail investors endured the biggest losses as the stock fell by 11%.

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

View our latest analysis for Salasar Techno Engineering

What Does The Institutional Ownership Tell Us About Salasar Techno Engineering?

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 Salasar Techno Engineering. 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. 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 Salasar Techno Engineering, (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 Salasar Techno Engineering. Hill View Infrabuild Ltd. is currently the largest shareholder, with 17% of shares outstanding. The second and third largest shareholders are Shashank Agarwal and Shalabh Agarwal, with an equal amount of shares to their name at 7.5%. Interestingly, the bottom two of the top three shareholders also hold the title of Co-Chief Executive Officer and Member of the Board of Directors, respectively, suggesting that these insiders have a personal stake in the company. In addition, we found that Alok Kumar, the CEO has 6.5% of the shares allocated to their name.

We did some more digging and found that 8 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Salasar Techno Engineering

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders maintain a significant holding in Salasar Techno Engineering Limited. Insiders own ₹4.3b worth of shares in the ₹15b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 33% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Salasar Techno Engineering. 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.

Private Company Ownership

Our data indicates that Private Companies hold 30%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Salasar Techno Engineering better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Salasar Techno Engineering you should be aware of, and 1 of them is a bit unpleasant.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.