eClerx Services Limited (NSE:ECLERX) Top Key Executive Priyadarshan Mundhra's holdings dropped 4.0% in value as a result of the recent pullback

Key Insights

• eClerx Services' significant insider ownership suggests inherent interests in company's expansion
• The top 2 shareholders own 53% of the company
• 29% of eClerx Services is held by Institutions

To get a sense of who is truly in control of eClerx Services Limited (NSE:ECLERX), it is important to understand the ownership structure of the business. With 53% stake, individual insiders possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And last week, insiders endured the biggest losses as the stock fell by 4.0%.

In the chart below, we zoom in on the different ownership groups of eClerx Services.

View our latest analysis for eClerx Services

What Does The Institutional Ownership Tell Us About eClerx Services?

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 eClerx Services 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. 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 eClerx Services' earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in eClerx Services. From our data, we infer that the largest shareholder is Priyadarshan Mundhra (who also holds the title of Top Key Executive) with 27% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. With 27% and 9.5% of the shares outstanding respectively, Anjan Malik and HDFC Asset Management Company Limited are the second and third largest shareholders. Interestingly, the second-largest shareholder, Anjan Malik is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 53% 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 eClerx Services

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 the majority of eClerx Services Limited. This means they can collectively make decisions for the company. Insiders own ₹77b worth of shares in the ₹144b company. That's extraordinary! 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, who are usually individual investors, hold a 16% stake in eClerx Services. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand eClerx Services better, we need to consider many other factors.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

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.