Likhitha Infrastructure Limited's (NSE:LIKHITHA) most bullish insider is Senior Key Executive Srinivasa Gaddipati, and their holdings value went up by 11% last week

Key Insights

• Likhitha Infrastructure's significant insider ownership suggests inherent interests in company's expansion
• The largest shareholder of the company is Srinivasa Gaddipati with a 68% stake
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Likhitha Infrastructure Limited (NSE:LIKHITHA) can tell us which group is most powerful. With 72% stake, individual insiders possess the maximum shares in the company. 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 ₹1.1b last week.

In the chart below, we zoom in on the different ownership groups of Likhitha Infrastructure.

View our latest analysis for Likhitha Infrastructure

What Does The Lack Of Institutional Ownership Tell Us About Likhitha Infrastructure?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Likhitha Infrastructure might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

We note that hedge funds don't have a meaningful investment in Likhitha Infrastructure. Our data suggests that Srinivasa Gaddipati, who is also the company's Senior Key Executive, holds the most number of shares at 68%. 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. Meanwhile, the second and third largest shareholders, hold 1.9% and 1.8%, of the shares outstanding, respectively.

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 Likhitha Infrastructure

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

It seems that insiders own more than half the Likhitha Infrastructure Limited stock. This gives them a lot of power. That means they own ₹8.0b worth of shares in the ₹11b company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 27% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Likhitha Infrastructure. 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:

It's always worth thinking about the different groups who own shares in a company. But to understand Likhitha Infrastructure 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 Likhitha Infrastructure , and understanding them should be part of your investment process.

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.