Prataap Snacks Limited's (NSE:DIAMONDYD) biggest owners are public companies who got richer after stock soared 14% last week

Key Insights

• The considerable ownership by public companies in Prataap Snacks indicates that they collectively have a greater say in management and business strategy
• A total of 2 investors have a majority stake in the company with 51% ownership
• Insiders have been selling lately

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To get a sense of who is truly in control of Prataap Snacks Limited (NSE:DIAMONDYD), it is important to understand the ownership structure of the business. And the group that holds the biggest piece of the pie are public companies with 48% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies collectively scored the highest last week as the company hit ₹28b market cap following a 14% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Prataap Snacks.

Check out our latest analysis for Prataap Snacks

What Does The Institutional Ownership Tell Us About Prataap Snacks?

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.

As you can see, institutional investors have a fair amount of stake in Prataap Snacks. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Prataap Snacks, (below). Of course, keep in mind that there are other factors to consider, too.

Prataap Snacks is not owned by hedge funds. Our data shows that Authum Investment & Infrastructure Limited is the largest shareholder with 48% of shares outstanding. For context, the second largest shareholder holds about 3.9% of the shares outstanding, followed by an ownership of 3.4% by the third-largest shareholder. Note that the second and third-largest shareholders are also Chief Executive Officer and Member of the Board of Directors, respectively, meaning that the company's top shareholders are insiders.

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. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Prataap Snacks

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.

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 insiders own a significant proportion of Prataap Snacks Limited. It has a market capitalization of just ₹28b, and insiders have ₹3.4b worth of shares in their own names. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 20% stake in Prataap Snacks. 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.

Public Company Ownership

Public companies currently own 48% of Prataap Snacks 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:

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.

I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow, for free.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.