After the recent decline, Kolte-Patil Developers Limited (NSE:KOLTEPATIL) Top Key Executive Rajesh Patil's holdings have lost 10% of their value

Key Insights

• Significant insider control over Kolte-Patil Developers implies vested interests in company growth
• The top 3 shareholders own 53% of the company
• Analyst forecasts along with ownership data serve to give a strong idea about prospects for a business

A look at the shareholders of Kolte-Patil Developers Limited (NSE:KOLTEPATIL) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are individual insiders with 73% ownership. Put another way, the group faces the maximum upside potential (or downside risk).

And following last week's 10% decline in share price, insiders suffered the most losses.

In the chart below, we zoom in on the different ownership groups of Kolte-Patil Developers.

View our latest analysis for Kolte-Patil Developers

What Does The Institutional Ownership Tell Us About Kolte-Patil Developers?

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.

Kolte-Patil Developers already has institutions on the share registry. Indeed, they own a respectable stake in the company. 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. When multiple institutions own a stock, there's always a risk that they are in a 'crowded trade'. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Kolte-Patil Developers' historic earnings and revenue below, but keep in mind there's always more to the story.

Hedge funds don't have many shares in Kolte-Patil Developers. From our data, we infer that the largest shareholder is Rajesh Patil (who also holds the title of Top Key Executive) with 30% of shares outstanding. Its usually considered a good sign when insiders own a significant number of shares in the company, and in this case, we're glad to see a company insider play the role of a key stakeholder. With 15% and 8.5% of the shares outstanding respectively, Naresh Patil and Milind Kolte are the second and third largest shareholders. Note that two of the top three shareholders are also Senior Key Executive and Member of the Board of Directors, respectively, once again pointing to significant ownership by company insiders.

To make our study more interesting, we found that the top 3 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. 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 Kolte-Patil Developers

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 Kolte-Patil Developers Limited. This gives them effective control of the company. So they have a ₹27b stake in this ₹37b business. Most would be pleased to see the board is investing alongside them. You may wish todiscover (for free) if they have been buying or selling.

General Public Ownership

The general public, who are usually individual investors, hold a 18% stake in Kolte-Patil Developers. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Kolte-Patil Developers better, we need to consider many other factors. For instance, we've identified 2 warning signs for Kolte-Patil Developers (1 is concerning) that you should be aware of.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.