Voltamp Transformers Limited (NSE:VOLTAMP) Co-Chief Executive Officer Kunjalbhai Patel, the company's largest shareholder sees 7.5%reduction in holdings value

Key Insights

• Insiders appear to have a vested interest in Voltamp Transformers' growth, as seen by their sizeable ownership
• The top 3 shareholders own 54% of the company
• 36% of Voltamp Transformers is held by Institutions

A look at the shareholders of Voltamp Transformers Limited (NSE:VOLTAMP) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 38% 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 7.5% 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 Voltamp Transformers.

View our latest analysis for Voltamp Transformers

What Does The Institutional Ownership Tell Us About Voltamp Transformers?

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 Voltamp Transformers. 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. 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 Voltamp Transformers' earnings history below. Of course, the future is what really matters.

Hedge funds don't have many shares in Voltamp Transformers. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Voltamp Transformers' case, its Co-Chief Executive Officer, Kunjalbhai Patel, is the largest shareholder, holding 38% of shares outstanding. For context, the second largest shareholder holds about 8.8% of the shares outstanding, followed by an ownership of 7.7% by the third-largest shareholder.

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 54% stake.

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 Voltamp Transformers

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.

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 most recent data indicates that insiders own a reasonable proportion of Voltamp Transformers Limited. It has a market capitalization of just ₹80b, and insiders have ₹30b worth of shares in their own names. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 17% stake in the company, and hence can't easily be ignored. 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.

Private Equity Ownership

With an ownership of 8.8%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Voltamp Transformers better, we need to consider many other factors. Case in point: We've spotted 1 warning sign for Voltamp Transformers you should be aware of.

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.