In spite of recent selling, insiders at Amber Enterprises India Limited (NSE:AMBER) are the largest shareholders; own 43% shares

Key Insights

• Significant insider control over Amber Enterprises India implies vested interests in company growth
• 54% of the business is held by the top 5 shareholders
• Recent sales by insiders

A look at the shareholders of Amber Enterprises India Limited (NSE:AMBER) can tell us which group is most powerful. With 43% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Insiders are at the top of the company's shareholdings despite selling some shares recently. As a result, they were also the biggest winners as market cap hit ₹141b last week.

In the chart below, we zoom in on the different ownership groups of Amber Enterprises India.

View our latest analysis for Amber Enterprises India

What Does The Institutional Ownership Tell Us About Amber Enterprises India?

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 Amber Enterprises India does have institutional investors; and they hold a good portion of the company's stock. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 Amber Enterprises India, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Amber Enterprises India. Looking at our data, we can see that the largest shareholder is the CEO Jasbir Singh with 21% of shares outstanding. In comparison, the second and third largest shareholders hold about 18% and 5.7% of the stock. Interestingly, the second-largest shareholder, Daljit Singh is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

On looking further, we found that 54% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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

Insider Ownership Of Amber Enterprises India

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. 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 Amber Enterprises India Limited. It has a market capitalization of just ₹141b, and insiders have ₹61b worth of shares in their own names. That's quite significant. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

The general public, who are usually individual investors, hold a 10% stake in Amber Enterprises India. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

I find it very interesting to look at who exactly owns a company. But to truly gain insight, we need to consider other information, too. Case in point: We've spotted 1 warning sign for Amber Enterprises India 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.