Individual investors invested in Krsnaa Diagnostics Limited (NSE:KRSNAA) up 11% last week, insiders too were rewarded

Key Insights

• Krsnaa Diagnostics' significant individual investors ownership suggests that the key decisions are influenced by shareholders from the larger public
• 50% of the business is held by the top 4 shareholders
• 27% of Krsnaa Diagnostics is held by insiders

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Every investor in Krsnaa Diagnostics Limited (NSE:KRSNAA) should be aware of the most powerful shareholder groups. With 33% stake, individual investors 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).

While individual investors were the group that reaped the most benefits after last week’s 11% price gain, insiders also received a 27% cut.

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

View our latest analysis for Krsnaa Diagnostics

What Does The Institutional Ownership Tell Us About Krsnaa Diagnostics?

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 Krsnaa Diagnostics does have institutional investors; and they hold a good portion of the company's stock. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Krsnaa Diagnostics' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Krsnaa Diagnostics. From our data, we infer that the largest shareholder is Rajendra Mutha (who also holds the title of Top Key Executive) with 25% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. With 15% and 7.7% of the shares outstanding respectively, Phi Capital Management LLP and Tata Asset Management Pvt. Ltd are the second and third largest shareholders.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Krsnaa Diagnostics

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 Krsnaa Diagnostics Limited. It has a market capitalization of just ₹25b, and insiders have ₹6.9b worth of shares in their own names. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 33% stake in the company, and hence can't easily be ignored. 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.

Private Equity Ownership

With a stake of 15%, private equity firms could influence the Krsnaa Diagnostics board. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

It seems that Private Companies own 3.4%, of the Krsnaa Diagnostics stock. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Krsnaa Diagnostics better, we need to consider many other factors. To that end, you should be aware of the 1 warning sign we've spotted with Krsnaa Diagnostics .

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its 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.