Greenpanel Industries Limited (NSE:GREENPANEL) surges 15%; private companies who own 40% shares profited along with institutions

Key Insights

• Greenpanel Industries' significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• A total of 3 investors have a majority stake in the company with 53% ownership
• Insider ownership in Greenpanel Industries is 14%

A look at the shareholders of Greenpanel Industries Limited (NSE:GREENPANEL) can tell us which group is most powerful. We can see that private companies own the lion's share in the company with 40% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

Following a 15% increase in the stock price last week, private companies profited the most, but institutions who own 30% stock also stood to gain from the increase.

In the chart below, we zoom in on the different ownership groups of Greenpanel Industries.

Check out our latest analysis for Greenpanel Industries

What Does The Institutional Ownership Tell Us About Greenpanel Industries?

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.

Greenpanel Industries already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. 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 Greenpanel Industries' historic earnings and revenue below, but keep in mind there's always more to the story.

Greenpanel Industries is not owned by hedge funds. The company's largest shareholder is Prime Holdings Pvt Ltd, with ownership of 39%. For context, the second largest shareholder holds about 8.6% of the shares outstanding, followed by an ownership of 5.5% by the third-largest shareholder. Shobhan Mittal, who is the second-largest shareholder, also happens to hold the title of Chief Executive Officer.

A more detailed study of the shareholder registry showed us that 3 of the top shareholders have a considerable amount of ownership in the company, via their 53% stake.

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

Insider Ownership Of Greenpanel Industries

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

Our information suggests that insiders maintain a significant holding in Greenpanel Industries Limited. Insiders own ₹6.3b worth of shares in the ₹46b company. It is great to see insiders so invested in the business. It might be worth checking if those insiders have been buying recently.

General Public Ownership

With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Greenpanel Industries. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 40%, of the shares on issue. 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:

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 3 warning signs for Greenpanel Industries you should be aware of, and 1 of them is a bit unpleasant.

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.