DMCC Speciality Chemicals Limited (NSE:DMCC) adds ₹1.1b in market cap and insiders have a 52% stake in that gain

Key Insights

• Significant insider control over DMCC Speciality Chemicals implies vested interests in company growth
• A total of 5 investors have a majority stake in the company with 52% ownership
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

A look at the shareholders of DMCC Speciality Chemicals Limited (NSE:DMCC) can tell us which group is most powerful. With 52% stake, individual insiders 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).

Clearly, insiders benefitted the most after the company's market cap rose by ₹1.1b last week.

Let's take a closer look to see what the different types of shareholders can tell us about DMCC Speciality Chemicals.

See our latest analysis for DMCC Speciality Chemicals

What Does The Lack Of Institutional Ownership Tell Us About DMCC Speciality Chemicals?

Small companies that are not very actively traded often lack institutional investors, but it's less common to see large companies without them.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. On the other hand, it's always possible that professional investors are avoiding a company because they don't think it's the best place for their money. DMCC Speciality Chemicals' earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

DMCC Speciality Chemicals is not owned by hedge funds. Laxmikumar Goculdas is currently the largest shareholder, with 36% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 4.8% and 4.3%, of the shares outstanding, respectively. In addition, we found that Bimal Goculdas, the CEO has 2.2% of the shares allocated to their name.

To make our study more interesting, we found that the top 5 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of DMCC Speciality Chemicals

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.

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.

It seems that insiders own more than half the DMCC Speciality Chemicals Limited stock. This gives them a lot of power. That means they own ₹4.9b worth of shares in the ₹9.4b 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

With a 32% ownership, the general public, mostly comprising of individual investors, have some degree of sway over DMCC Speciality Chemicals. 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

We can see that Private Companies own 15%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the company.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 4 warning signs for DMCC Speciality Chemicals you should be aware of, and 1 of them is significant.

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.