Individual investors in Intellect Design Arena Limited (NSE:INTELLECT) are its biggest bettors, and their bets paid off as stock gained 6.9% last week

Key Insights

• Significant control over Intellect Design Arena by individual investors implies that the general public has more power to influence management and governance-related decisions
• The top 7 shareholders own 50% of the company
• Insider ownership in Intellect Design Arena is 14%

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If you want to know who really controls Intellect Design Arena Limited (NSE:INTELLECT), then you'll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual investors with 38% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, individual investors collectively scored the highest last week as the company hit ₹113b market cap following a 6.9% gain in the stock.

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

View our latest analysis for Intellect Design Arena

What Does The Institutional Ownership Tell Us About Intellect Design Arena?

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.

Intellect Design Arena already has institutions on the share registry. Indeed, they own a respectable stake in the company. This suggests some credibility amongst professional investors. But we can't rely on that fact alone since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It's therefore worth looking at Intellect Design Arena's earnings history below. Of course, the future is what really matters.

Our data indicates that hedge funds own 8.2% of Intellect Design Arena. That worth noting, since hedge funds are often quite active investors, who may try to influence management. Many want to see value creation (and a higher share price) in the short term or medium term. Polaris Banyan Holdings Private Limited is currently the largest shareholder, with 23% of shares outstanding. In comparison, the second and third largest shareholders hold about 8.2% and 7.0% of the stock. Arun Jain, who is the third-largest shareholder, also happens to hold the title of Chairman of the Board.

We did some more digging and found that 7 of the top shareholders account for roughly 50% of the register, implying that along with larger shareholders, there are a few smaller shareholders, thereby balancing out each others interests somewhat.

Researching institutional ownership is a good way to gauge and filter a stock's expected performance. The same can be achieved by studying analyst sentiments. There are plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.

Insider Ownership Of Intellect Design Arena

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board themselves.

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 information suggests that insiders maintain a significant holding in Intellect Design Arena Limited. Insiders own ₹16b worth of shares in the ₹113b company. That's quite meaningful. Most would say this shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public-- including retail investors -- own 38% stake in the company, and hence can't easily be ignored. 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 Company Ownership

We can see that Private Companies own 23%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it's hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

I like to dive deeper into how a company has performed in the past. You can find historic revenue and earnings in this detailed graph.

If you would prefer discover what analysts are predicting in terms of future growth, do not miss this free report on analyst forecasts.

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.