Suratwwala Business Group Limited's (NSE:SBGLP) insiders are still the largest shareholders with 76% stake despite recent sales

Key Insights

• Suratwwala Business Group's significant insider ownership suggests inherent interests in company's expansion
• A total of 2 investors have a majority stake in the company with 58% ownership
• Insiders have sold recently

If you want to know who really controls Suratwwala Business Group Limited (NSE:SBGLP), then you'll have to look at the makeup of its share registry. With 76% stake, individual insiders possess the maximum shares in the company. Put another way, the group faces the maximum upside potential (or downside risk).

Even though insiders have sold shares recently, the group owns the most numbers of shares in the company and as a result benefitted the most after market cap rose ₹2.6b last week.

In the chart below, we zoom in on the different ownership groups of Suratwwala Business Group.

See our latest analysis for Suratwwala Business Group

What Does The Lack Of Institutional Ownership Tell Us About Suratwwala Business Group?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it's unusual to see larger companies without any institutional investors.

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. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Suratwwala Business Group'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.

Hedge funds don't have many shares in Suratwwala Business Group. With a 45% stake, CEO Jatin Suratwala is the largest shareholder. In comparison, the second and third largest shareholders hold about 14% and 5.5% of the stock. Interestingly, the second-largest shareholder, Manoj Suratwala 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 Suratwwala Business Group

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.

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 the majority of Suratwwala Business Group Limited. This means they can collectively make decisions for the company. Given it has a market cap of ₹23b, that means they have ₹17b worth of shares. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public-- including retail investors -- own 22% stake in the company, and hence can't easily be ignored. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Case in point: We've spotted 1 warning sign for Suratwwala Business Group you should be aware of.

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.