Dhampur Sugar Mills Limited (NSE:DHAMPURSUG) surges 12%; retail investors who own 40% shares profited along with institutions

Key Insights

• The considerable ownership by retail investors in Dhampur Sugar Mills indicates that they collectively have a greater say in management and business strategy
• A total of 5 investors have a majority stake in the company with 53% ownership
• Insider ownership in Dhampur Sugar Mills is 20%

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A look at the shareholders of Dhampur Sugar Mills Limited (NSE:DHAMPURSUG) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are retail investors with 40% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Retail investors gained the most after market cap touched ₹9.1b last week, while institutions who own 30% also benefitted.

In the chart below, we zoom in on the different ownership groups of Dhampur Sugar Mills.

View our latest analysis for Dhampur Sugar Mills

What Does The Institutional Ownership Tell Us About Dhampur Sugar Mills?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Dhampur Sugar Mills 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 Dhampur Sugar Mills' earnings history below. Of course, the future is what really matters.

Dhampur Sugar Mills is not owned by hedge funds. Goel Investments Ltd., Asset Management Arm is currently the company's largest shareholder with 28% of shares outstanding. Saraswati Properties Ltd. is the second largest shareholder owning 8.9% of common stock, and Gaurav Goel holds about 7.6% of the company stock. Gaurav Goel, who is the third-largest shareholder, also happens to hold the title of Vice Chairman.

On looking further, we found that 53% 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 Dhampur Sugar 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. 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 insiders maintain a significant holding in Dhampur Sugar Mills Limited. Insiders own ₹1.9b worth of shares in the ₹9.1b company. 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

The general public-- including retail investors -- own 40% stake in the company, and hence can't easily be ignored. 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 9.1%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

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. For example, we've discovered 3 warning signs for Dhampur Sugar Mills (1 is potentially serious!) that you should be aware of before investing here.

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.