Private companies in Surya Roshni Limited (NSE:SURYAROSNI) are its biggest bettors, and their bets paid off as stock gained 8.7% last week

Key Insights

• Surya Roshni's significant private companies ownership suggests that the key decisions are influenced by shareholders from the larger public
• The top 10 shareholders own 51% of the company
• 13% of Surya Roshni is held by Institutions

A look at the shareholders of Surya Roshni Limited (NSE:SURYAROSNI) can tell us which group is most powerful. The group holding the most number of shares in the company, around 55% to be precise, is private companies. 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, private companies collectively scored the highest last week as the company hit ₹72b market cap following a 8.7% gain in the stock.

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

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 implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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.

Hedge funds don't have many shares in Surya Roshni. The company's largest shareholder is Diwakar Marketing Pvt Ltd, with ownership of 10%. With 9.0% and 5.9% of the shares outstanding respectively, Cubitex Marketing Pvt Ltd and Shreyansh Mercantile Pvt Ltd are the second and third largest shareholders. In addition, we found that Vinay Surya, the CEO has 2.3% of the shares allocated to their name.

We also observed that the top 10 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Surya Roshni

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 most recent data indicates that insiders own some shares in Surya Roshni Limited. As individuals, the insiders collectively own ₹7.2b worth of the ₹72b company. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.

General Public Ownership

The general public, who are usually individual investors, hold a 22% stake in Surya Roshni. 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.

Private Company Ownership

We can see that Private Companies own 55%, of the shares on issue. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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. For example, we've discovered 1 warning sign for Surya Roshni that you should be aware of before investing here.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com