The recent ₹13b market cap decrease is likely to have disappointed insiders invested in Anant Raj Limited (NSE:ANANTRAJ)

Key Insights

• Anant Raj's significant insider ownership suggests inherent interests in company's expansion
• 55% of the business is held by the top 5 shareholders
• Institutions own 17% of Anant Raj

To get a sense of who is truly in control of Anant Raj Limited (NSE:ANANTRAJ), it is important to understand the ownership structure of the business. The group holding the most number of shares in the company, around 57% to be precise, is individual insiders. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 7.0% decline in share price, insiders suffered the most losses.

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

View our latest analysis for Anant Raj

What Does The Institutional Ownership Tell Us About Anant Raj?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it's included in a major index. We would expect most companies to have some institutions on the register, especially if they are growing.

We can see that Anant Raj does have institutional investors; and they hold a good portion of the company's stock. 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 Anant Raj, (below). Of course, keep in mind that there are other factors to consider, too.

Hedge funds don't have many shares in Anant Raj. Our data shows that Roma Sarin is the largest shareholder with 14% of shares outstanding. The second and third largest shareholders are Ashim Sarin and Aashman Sarin, with an equal amount of shares to their name at 14%. Ashim Sarin, who is the second-largest shareholder, also happens to hold the title of Chief Operating Officer.

On looking further, we found that 55% of the shares are owned by the top 5 shareholders. In other words, these shareholders have a meaningful say in 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. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.

Insider Ownership Of Anant Raj

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. 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.

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 Anant Raj Limited. This gives them effective control of the company. Given it has a market cap of ₹177b, that means insiders have a whopping ₹100b worth of shares in their own names. It is good to see this level of investment. You can check here to see if those insiders have been selling any of their shares.

General Public Ownership

With a 17% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Anant Raj. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

Our data indicates that Private Companies hold 9.7%, 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. Case in point: We've spotted 1 warning sign for Anant Raj you should be aware of.

But ultimately it is the future, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at this free report showing whether analysts are predicting a brighter 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.