Institutions along with public companies who hold considerable shares inAditya Birla Sun Life AMC Limited (NSE:ABSLAMC) come under pressure; lose 5.8% of holdings value

Key Insights

• The considerable ownership by public companies in Aditya Birla Sun Life AMC indicates that they collectively have a greater say in management and business strategy
• 75% of the business is held by the top 2 shareholders
• 41% of Aditya Birla Sun Life AMC is held by Institutions

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If you want to know who really controls Aditya Birla Sun Life AMC Limited (NSE:ABSLAMC), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 48% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions, who own 41% shares weren’t spared from last week’s ₹14b market cap drop, public companies as a group suffered the maximum losses

Let's take a closer look to see what the different types of shareholders can tell us about Aditya Birla Sun Life AMC.

Check out our latest analysis for Aditya Birla Sun Life AMC

What Does The Institutional Ownership Tell Us About Aditya Birla Sun Life AMC?

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 Aditya Birla Sun Life AMC 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. 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 Aditya Birla Sun Life AMC's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Aditya Birla Sun Life AMC. Looking at our data, we can see that the largest shareholder is Grasim Industries Limited with 45% of shares outstanding. With 30% and 3.2% of the shares outstanding respectively, Sun Life (India) AMC Investments Inc. and Nippon Life India Asset Management Limited are the second and third largest shareholders.

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.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Aditya Birla Sun Life AMC

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our information suggests that Aditya Birla Sun Life AMC Limited insiders own under 1% of the company. It's a big company, so even a small proportional interest can create alignment between the board and shareholders. In this case insiders own ₹46m worth of shares. It is always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.

General Public Ownership

The general public-- including retail investors -- own 11% stake in the company, and hence can't easily be ignored. 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.

Public Company Ownership

It appears to us that public companies own 48% of Aditya Birla Sun Life AMC. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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. To that end, you should be aware of the 1 warning sign we've spotted with Aditya Birla Sun Life AMC .

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.