Deepak Nitrite Limited's (NSE:DEEPAKNTR) market cap touched ₹384b last week, benefiting both private companies who own 32% as well as institutions

Key Insights

• Significant control over Deepak Nitrite by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 7 shareholders own 50% of the company
• Recent sales by insiders

Every investor in Deepak Nitrite Limited (NSE:DEEPAKNTR) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 32% to be precise, is private companies. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

While private companies were the group that benefitted the most from last week’s ₹25b market cap gain, institutions too had a 27% share in those profits.

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

View our latest analysis for Deepak Nitrite

What Does The Institutional Ownership Tell Us About Deepak Nitrite?

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

Hedge funds don't have many shares in Deepak Nitrite. From our data, we infer that the largest shareholder is Deepak Mehta (who also holds the title of Top Key Executive) with 17% 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. For context, the second largest shareholder holds about 9.5% of the shares outstanding, followed by an ownership of 6.2% by the third-largest shareholder.

We did some more digging and found that 7 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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 a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Deepak Nitrite

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.

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 Deepak Nitrite Limited. Insiders own ₹66b worth of shares in the ₹384b company. That's quite meaningful. Most would be pleased to see the board is investing alongside them. You may wish to access this free chart showing recent trading by insiders.

General Public Ownership

With a 23% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Deepak Nitrite. 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 Company Ownership

Our data indicates that Private Companies hold 32%, 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 Deepak Nitrite better, we need to consider many other factors. Take risks for example - Deepak Nitrite has 1 warning sign we think you should be aware of.

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.