eClerx Services Limited's (NSE:ECLERX): Top Key Executive Priyadarshan Mundhra is the most bullish insider, and their stock value gained 4.6% last week

Key Insights

• Significant insider control over eClerx Services implies vested interests in company growth
• 54% of the business is held by the top 2 shareholders
• 30% of eClerx Services is held by Institutions

If you want to know who really controls eClerx Services Limited (NSE:ECLERX), then you'll have to look at the makeup of its share registry. With 55% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

As a result, insiders were the biggest beneficiaries of last week’s 4.6% gain.

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

See our latest analysis for eClerx Services

What Does The Institutional Ownership Tell Us About eClerx Services?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that eClerx Services does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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.

eClerx Services is not owned by hedge funds. Our data suggests that Priyadarshan Mundhra, who is also the company's Top Key Executive, holds the most number of shares at 27%. When an insider holds a sizeable amount of a company's stock, investors consider it as a positive sign because it suggests that insiders are willing to have their wealth tied up in the future of the company. Anjan Malik is the second largest shareholder owning 27% of common stock, and HDFC Asset Management Company Limited holds about 9.0% of the company stock. Interestingly, the second-largest shareholder, Anjan Malik is also Top Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

After doing some more digging, we found that the top 2 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 eClerx Services

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems that insiders own more than half the eClerx Services Limited stock. This gives them a lot of power. Insiders own ₹65b worth of shares in the ₹119b 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-- including retail investors -- own 14% 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.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.