Insiders were the biggest winners as Siyaram Silk Mills Limited's (NSE:SIYSIL) market cap grew by ₹2.0b last week

Key Insights

• Insiders appear to have a vested interest in Siyaram Silk Mills' growth, as seen by their sizeable ownership
• The top 5 shareholders own 52% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

Every investor in Siyaram Silk Mills Limited (NSE:SIYSIL) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 44% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, insiders benefitted the most after the company's market cap rose by ₹2.0b last week.

Let's take a closer look to see what the different types of shareholders can tell us about Siyaram Silk Mills.

See our latest analysis for Siyaram Silk Mills

What Does The Institutional Ownership Tell Us About Siyaram Silk Mills?

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.

Less than 5% of Siyaram Silk Mills is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. So if the company itself can improve over time, we may well see more institutional buyers in the future. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

We note that hedge funds don't have a meaningful investment in Siyaram Silk Mills. Our data shows that PKP Enterprises LLP is the largest shareholder with 24% of shares outstanding. Rameshkumar Poddar is the second largest shareholder owning 9.3% of common stock, and Vibha Poddar holds about 7.6% of the company stock. Rameshkumar Poddar, who is the second-largest shareholder, also happens to hold the title of Co-Chief Executive Officer.

On looking further, we found that 52% 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 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Siyaram Silk Mills

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.

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 Siyaram Silk Mills Limited. It has a market capitalization of just ₹20b, and insiders have ₹9.0b 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

With a 26% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Siyaram Silk Mills. 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

Our data indicates that Private Companies hold 24%, of the company's shares. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

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

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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.