Astec LifeSciences Limited's (NSE:ASTEC) stock price dropped 18% last week; public companies would not be happy

Key Insights

• Astec LifeSciences' significant public companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• 65% of the company is held by a single shareholder (Godrej Industries Limited)
• Using data from company's past performance alongside ownership research, one can better assess the future performance of a company

If you want to know who really controls Astec LifeSciences Limited (NSE:ASTEC), then you'll have to look at the makeup of its share registry. We can see that public companies own the lion's share in the company with 65% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And last week, public companies endured the biggest losses as the stock fell by 18%.

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

See our latest analysis for Astec LifeSciences

What Does The Institutional Ownership Tell Us About Astec LifeSciences?

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.

As you can see, institutional investors have a fair amount of stake in Astec LifeSciences. 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. 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 Astec LifeSciences' earnings history below. Of course, the future is what really matters.

Astec LifeSciences is not owned by hedge funds. Godrej Industries Limited is currently the company's largest shareholder with 65% of shares outstanding. This implies that they have majority interest control of the future of the company. For context, the second largest shareholder holds about 3.2% of the shares outstanding, followed by an ownership of 2.4% by the third-largest shareholder.

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. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Astec LifeSciences

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.

Most consider insider ownership a positive because it can indicate the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.

Shareholders would probably be interested to learn that insiders own shares in Astec LifeSciences Limited. In their own names, insiders own ₹1.4b worth of stock in the ₹15b company. It is good to see some investment by insiders, but we usually like to see higher insider holdings. It might be worth checking if those insiders have been buying.

General Public Ownership

With a 16% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Astec LifeSciences. 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

We can see that public companies hold 65% of the Astec LifeSciences shares on issue. We can't be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

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. Take risks for example - Astec LifeSciences has 2 warning signs (and 1 which is concerning) we think you should know about.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.