Institutions along with private companies who hold considerable shares inACC Limited (NSE:ACC) come under pressure; lose 6.3% of holdings value

Key Insights

• The considerable ownership by private companies in ACC indicates that they collectively have a greater say in management and business strategy
• 57% of the company is held by a single shareholder (S.B. Adani Family Trust)
• Institutions own 27% of ACC

If you want to know who really controls ACC Limited (NSE:ACC), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are private companies with 57% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While institutions, who own 27% shares weren’t spared from last week’s ₹24b market cap drop, private companies as a group suffered the maximum losses

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

Check out our latest analysis for ACC

What Does The Institutional Ownership Tell Us About ACC?

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 ACC. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. 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 ACC, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in ACC. S.B. Adani Family Trust is currently the company's largest shareholder with 57% of shares outstanding. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Life Insurance Corporation of India, Asset Management Arm is the second largest shareholder owning 6.6% of common stock, and HDFC Asset Management Company Limited holds about 3.3% of the company stock.

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 are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of ACC

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.

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.

We note our data does not show any board members holding shares, personally. Not all jurisdictions have the same rules around disclosing insider ownership, and it is possible we have missed something, here. So you can click here learn more about the CEO.

General Public Ownership

The general public, who are usually individual investors, hold a 15% stake in ACC. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

Our data indicates that Private Companies hold 57%, of the company's shares. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private company.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand ACC better, we need to consider many other factors. Take risks for example - ACC has 2 warning signs (and 1 which doesn't sit too well with us) we think you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.