Private companies are Surya Roshni Limited's (NSE:SURYAROSNI) biggest owners and were hit after market cap dropped ₹8.4b

Key Insights

• Significant control over Surya Roshni by private companies implies that the general public has more power to influence management and governance-related decisions
• The top 10 shareholders own 52% of the company
• Institutions own 15% of Surya Roshni

Every investor in Surya Roshni Limited (NSE:SURYAROSNI) should be aware of the most powerful shareholder groups. And the group that holds the biggest piece of the pie are private companies with 55% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week's 11% decline in share price, private companies suffered the most losses.

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

Check out our latest analysis for Surya Roshni

What Does The Institutional Ownership Tell Us About Surya Roshni?

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.

As you can see, institutional investors have a fair amount of stake in Surya Roshni. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Surya Roshni, (below). Of course, keep in mind that there are other factors to consider, too.

Surya Roshni is not owned by hedge funds. Our data shows that Diwakar Marketing Pvt Ltd is the largest shareholder with 11% of shares outstanding. In comparison, the second and third largest shareholders hold about 9.1% and 5.9% of the stock. Additionally, the company's CEO Vinay Surya directly holds 2.4% of the total shares outstanding.

We did some more digging and found that 10 of the top shareholders account for roughly 52% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

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. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Surya Roshni

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Surya Roshni Limited. It has a market capitalization of just ₹71b, and insiders have ₹7.1b worth of shares, in their own names. It is good to see some investment by insiders, but it might be worth checking if those insiders have been buying.

General Public Ownership

The general public, who are usually individual investors, hold a 19% stake in Surya Roshni. 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 55%, 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:

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. Take risks for example - Surya Roshni has 2 warning signs we think you should be aware of.

If you are like me, you may want to think about whether this company will grow or shrink. Luckily, you can check this free report showing analyst forecasts for its future.

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.