Rajarathinam Balakrishnan Basilic Fly Studio Limited's (NSE:BASILIC) CEO is the most bullish insider, and their stock value gained 23%last week

Key Insights

• Insiders appear to have a vested interest in Basilic Fly Studio's growth, as seen by their sizeable ownership
• 60% 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

Our free stock report includes 2 warning signs investors should be aware of before investing in Basilic Fly Studio. Read for free now.

Every investor in Basilic Fly Studio Limited (NSE:BASILIC) should be aware of the most powerful shareholder groups. We can see that individual insiders own the lion's share in the company with 70% 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 ₹8.8b market cap following a 23% gain in the stock.

In the chart below, we zoom in on the different ownership groups of Basilic Fly Studio.

See our latest analysis for Basilic Fly Studio

What Does The Lack Of Institutional Ownership Tell Us About Basilic Fly Studio?

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. Basilic Fly Studio's earnings and revenue track record (below) may not be compelling to institutional investors -- or they simply might not have looked at the business closely.

Basilic Fly Studio is not owned by hedge funds. The company's CEO Rajarathinam Balakrishnan is the largest shareholder with 45% of shares outstanding. Sundaram Yogalakshmi is the second largest shareholder owning 15% of common stock, and Aparna Thakker holds about 4.9% of the company stock. Interestingly, the second-largest shareholder, Sundaram Yogalakshmi is also Senior Key Executive, again, pointing towards strong insider ownership amongst the company's top shareholders.

To make our study more interesting, we found that the top 2 shareholders have a majority ownership in the company, meaning that they are powerful enough to influence the decisions of the company.

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 Basilic Fly Studio

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

I generally consider insider ownership to be a good thing. However, on some occasions it makes it more difficult for other shareholders to hold the board accountable for decisions.

Our information suggests that insiders own more than half of Basilic Fly Studio Limited. This gives them effective control of the company. So they have a ₹6.1b stake in this ₹8.8b business. 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

With a 30% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Basilic Fly Studio. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Basilic Fly Studio better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Basilic Fly Studio you should be aware of, and 1 of them makes us a bit uncomfortable.

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.