The recent 7.2% gain must have brightened Co-Chief Executive Officer Anoop Gupta's week, KRBL Limited's (NSE:KRBL) most bullish insider

Key Insights

• KRBL's significant insider ownership suggests inherent interests in company's expansion
• The top 3 shareholders own 60% of the company
• Institutions own 12% of KRBL

We've discovered 2 warning signs about KRBL. View them for free.

Every investor in KRBL Limited (NSE:KRBL) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 66% to be precise, is individual insiders. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, insiders scored the highest last week as the company hit ₹66b market cap following a 7.2% gain in the stock.

Let's delve deeper into each type of owner of KRBL, beginning with the chart below.

See our latest analysis for KRBL

What Does The Institutional Ownership Tell Us About KRBL?

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 KRBL 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. 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 KRBL, (below). Of course, keep in mind that there are other factors to consider, too.

KRBL is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In KRBL's case, its Co-Chief Executive Officer, Anoop Gupta, is the largest shareholder, holding 20% of shares outstanding. The second and third largest shareholders are Anil Mittal and Arun Gupta, with an equal amount of shares to their name at 20%. Note that two of the top three shareholders are also Co-Chief Executive Officer and Member of the Board of Directors, respectively, once again pointing to significant ownership by company insiders.

To make our study more interesting, we found that the top 3 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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of KRBL

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.

Our most recent data indicates that insiders own the majority of KRBL Limited. This means they can collectively make decisions for the company. That means they own ₹44b worth of shares in the ₹66b company. That's quite meaningful. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 16% stake in KRBL. 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Consider for instance, the ever-present spectre of investment risk. We've identified 2 warning signs with KRBL (at least 1 which is significant) , 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.