Despite recent sales, Gulshan Polyols Limited (NSE:GULPOLY) insiders still control 45% of the company

Key Insights

• Gulshan Polyols' significant insider ownership suggests inherent interests in company's expansion
• 51% of the business is held by the top 3 shareholders
• Recent sales by insiders

Every investor in Gulshan Polyols Limited (NSE:GULPOLY) should be aware of the most powerful shareholder groups. With 45% 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).

Despite recent sales, insiders own the most shares in the company. As a result, they stand to gain the most after the stock gained 15% in the past week.

In the chart below, we zoom in on the different ownership groups of Gulshan Polyols.

View our latest analysis for Gulshan Polyols

What Does The Institutional Ownership Tell Us About Gulshan Polyols?

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.

Institutions have a very small stake in Gulshan Polyols. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it's the future that counts most.

Gulshan Polyols is not owned by hedge funds. Because actions speak louder than words, we consider it a good sign when insiders own a significant stake in a company. In Gulshan Polyols' case, its Top Key Executive, Chandra Jain, is the largest shareholder, holding 26% of shares outstanding. Arushi Jain is the second largest shareholder owning 13% of common stock, and Chandra Holding Trust holds about 11% of the company stock. Interestingly, the second-largest shareholder, Arushi Jain is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

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 51% stake.

While studying institutional ownership for a company can add value to your research, it is also a good practice to research analyst recommendations to get a deeper understand of a stock's expected performance. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Gulshan Polyols

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.

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.

Our most recent data indicates that insiders own a reasonable proportion of Gulshan Polyols Limited. Insiders own ₹6.5b worth of shares in the ₹14b company. This may suggest that the founders still own a lot of shares. You can click here to see if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 29% stake in the company, and hence can't easily be ignored. 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

Our data indicates that Private Companies hold 22%, 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:

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. Like risks, for instance. Every company has them, and we've spotted 2 warning signs for Gulshan Polyols (of which 1 is potentially serious!) you should know about.

Of course this may not be the best stock to buy. So take a peek at this free 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.