The recent 14% gain must have brightened CEO Saiyyed Ali's week, Owais Metal and Mineral Processing Limited's (NSE:OWAIS) most bullish insider

Key Insights

• Significant insider control over Owais Metal and Mineral Processing implies vested interests in company growth
• The largest shareholder of the company is Saiyyed Ali with a 72% stake
• Ownership research, combined with past performance data can help provide a good understanding of opportunities in a stock

Every investor in Owais Metal and Mineral Processing Limited (NSE:OWAIS) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are individual insiders with 73% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders scored the highest last week as the company hit ₹27b market cap following a 14% gain in the stock.

Let's delve deeper into each type of owner of Owais Metal and Mineral Processing, beginning with the chart below.

See our latest analysis for Owais Metal and Mineral Processing

What Does The Lack Of Institutional Ownership Tell Us About Owais Metal and Mineral Processing?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

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 Owais Metal and Mineral Processing, for yourself, below.

Owais Metal and Mineral Processing is not owned by hedge funds. The company's CEO Saiyyed Ali is the largest shareholder with 72% of shares outstanding. This essentially means that they have significant control over the outcome or future of the company, which is why insider ownership is usually looked upon favourably by prospective buyers. Sayyad Ali is the second largest shareholder owning 0.9% of common stock, and Samreen Ali holds about 0.0009% of the company stock.

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. We're not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Owais Metal and Mineral Processing

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. 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 information suggests that insiders own more than half of Owais Metal and Mineral Processing Limited. This gives them effective control of the company. That means they own ₹20b worth of shares in the ₹27b company. That's quite meaningful. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 27% 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:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Be aware that Owais Metal and Mineral Processing is showing 2 warning signs in our investment analysis , and 1 of those can't be ignored...

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.