Private equity firms are Jagsonpal Pharmaceuticals Limited's (NSE:JAGSNPHARM) biggest owners and were hit after market cap dropped ₹1.8b

Key Insights

• Significant control over Jagsonpal Pharmaceuticals by private equity firms implies that the general public has more power to influence management and governance-related decisions
• 55% of the business is held by the top 2 shareholders
• 14% of Jagsonpal Pharmaceuticals is held by insiders

Every investor in Jagsonpal Pharmaceuticals Limited (NSE:JAGSNPHARM) should be aware of the most powerful shareholder groups. We can see that private equity firms own the lion's share in the company with 35% 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 equity firms suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Jagsonpal Pharmaceuticals.

Check out our latest analysis for Jagsonpal Pharmaceuticals

What Does The Institutional Ownership Tell Us About Jagsonpal Pharmaceuticals?

Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.

Less than 5% of Jagsonpal Pharmaceuticals is held by institutional investors. This suggests that some funds have the company in their sights, but many have not yet bought shares in it. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.

Jagsonpal Pharmaceuticals is not owned by hedge funds. Infinity Investment Management, Investment Arm is currently the company's largest shareholder with 35% of shares outstanding. Aresko Progressive Private Limited is the second largest shareholder owning 20% of common stock, and Infinity Portfolio Holdings holds about 8.6% of the company stock. Furthermore, CEO Manish Gupta is the owner of 2.3% of the company's shares.

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 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. As far as we can tell there isn't analyst coverage of the company, so it is probably flying under the radar.

Insider Ownership Of Jagsonpal Pharmaceuticals

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 most recent data indicates that insiders own a reasonable proportion of Jagsonpal Pharmaceuticals Limited. Insiders have a ₹1.9b stake in this ₹14b business. We would say this shows alignment with shareholders, but it is worth noting that the company is still quite small; some insiders may have founded the business. You can click here to see if those insiders have been buying or selling.

General Public Ownership

With a 20% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Jagsonpal Pharmaceuticals. 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 Equity Ownership

With an ownership of 35%, private equity firms are in a position to play a role in shaping corporate strategy with a focus on value creation. Sometimes we see private equity stick around for the long term, but generally speaking they have a shorter investment horizon and -- as the name suggests -- don't invest in public companies much. After some time they may look to sell and redeploy capital elsewhere.

Private Company Ownership

Our data indicates that Private Companies hold 29%, of the company's shares. 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. Be aware that Jagsonpal Pharmaceuticals is showing 3 warning signs in our investment analysis , and 1 of those is significant...

Of course this may not be the best stock to buy. So take a peek at this free 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.