Both private companies who control a good portion of Monte Carlo Fashions Limited (NSE:MONTECARLO) along with institutions must be dismayed after last week's 11% decrease

Key Insights

• Monte Carlo Fashions' significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 2 investors have a majority stake in the company with 56% ownership
• 11% of Monte Carlo Fashions is held by insiders

To get a sense of who is truly in control of Monte Carlo Fashions Limited (NSE:MONTECARLO), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 35% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While the holdings of private companies took a hit after last week’s 11% price drop, institutions with their 26% holdings also suffered.

Let's delve deeper into each type of owner of Monte Carlo Fashions, beginning with the chart below.

Check out our latest analysis for Monte Carlo Fashions

What Does The Institutional Ownership Tell Us About Monte Carlo Fashions?

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 Monte Carlo Fashions 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 Monte Carlo Fashions' earnings history below. Of course, the future is what really matters.

Monte Carlo Fashions is not owned by hedge funds. The company's largest shareholder is Girnar Investment Ltd, with ownership of 32%. Meanwhile, the second and third largest shareholders, hold 24% and 8.0%, of the shares outstanding, respectively. In addition, we found that Jawahar Oswal, the CEO has 0.6% of the shares allocated to their name.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence 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. 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 Monte Carlo Fashions

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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

It seems insiders own a significant proportion of Monte Carlo Fashions Limited. Insiders have a ₹1.6b stake in this ₹15b business. 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

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Monte Carlo Fashions. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

It seems that Private Companies own 35%, of the Monte Carlo Fashions stock. 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.

Public Company Ownership

Public companies currently own 8.0% of Monte Carlo Fashions stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Monte Carlo Fashions better, we need to consider many other factors. Consider for instance, the ever-present spectre of investment risk. We've identified 1 warning sign with Monte Carlo Fashions , and understanding them should be part of your investment process.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.