CEO Raghuram Shetty, Heranba Industries Limited's (NSE:HERANBA) largest shareholder sees value of holdings go down 13% after recent drop

Explore Heranba Industries's Fair Values from the Community and select yours

Key Insights

• Insiders appear to have a vested interest in Heranba Industries' growth, as seen by their sizeable ownership
• 58% of the business is held by the top 2 shareholders
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

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If you want to know who really controls Heranba Industries Limited (NSE:HERANBA), then you'll have to look at the makeup of its share registry. The group holding the most number of shares in the company, around 74% to be precise, is individual insiders. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As market cap fell to ₹13b last week, insiders would have faced the highest losses than any other shareholder groups of the company.

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

Check out our latest analysis for Heranba Industries

What Does The Lack Of Institutional Ownership Tell Us About Heranba Industries?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

There could be various reasons why no institutions own shares in a company. Typically, small, newly listed companies don't attract much attention from fund managers, because it would not be possible for large fund managers to build a meaningful position in 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. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Heranba Industries, for yourself, below.

Heranba Industries is not owned by hedge funds. The company's CEO Raghuram Shetty is the largest shareholder with 35% of shares outstanding. With 23% and 8.1% of the shares outstanding respectively, Sadashiv Shetty and Sujata Shetty are the second and third largest shareholders. Interestingly, the second-largest shareholder, Sadashiv Shetty is also Top 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 2 of the top shareholders have a considerable amount of ownership in the company, via their 58% 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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Heranba Industries

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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.

Our most recent data indicates that insiders own the majority of Heranba Industries Limited. This means they can collectively make decisions for the company. So they have a ₹9.8b stake in this ₹13b business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 24% stake in the company, and hence can't easily be ignored. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Heranba Industries better, we need to consider many other factors. Case in point: We've spotted 3 warning signs for Heranba Industries you should be aware of, and 2 of them shouldn't be ignored.

If you would prefer check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, backed by strong financial data.

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.