Private companies who hold 45% of Nucleus Software Exports Limited (NSE:NUCLEUS) gained 11%, insiders profited as well

Key Insights

• Significant control over Nucleus Software Exports by private companies implies that the general public has more power to influence management and governance-related decisions
• 51% of the business is held by the top 2 shareholders
• Insider ownership in Nucleus Software Exports is 30%

A look at the shareholders of Nucleus Software Exports Limited (NSE:NUCLEUS) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 45% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

While private companies were the group that benefitted the most from last week’s ₹3.8b market cap gain, insiders too had a 30% share in those profits.

In the chart below, we zoom in on the different ownership groups of Nucleus Software Exports.

See our latest analysis for Nucleus Software Exports

What Does The Institutional Ownership Tell Us About Nucleus Software Exports?

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.

Institutions have a very small stake in Nucleus Software Exports. That indicates that the company is on the radar of some funds, but it isn't particularly popular with professional investors at the moment. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. When multiple institutional investors want to buy shares, we often see a rising share price. The past revenue trajectory (shown below) can be an indication of future growth, but there are no guarantees.

We note that hedge funds don't have a meaningful investment in Nucleus Software Exports. Our data shows that Karmayogi Holdings Pvt. Ltd. is the largest shareholder with 34% of shares outstanding. With 17% and 8.9% of the shares outstanding respectively, Vishnu Dusad and Nucleus Software Engineers Pvt. Ltd. are the second and third largest shareholders. Vishnu Dusad, who is the second-largest shareholder, also happens to hold the title of Top Key Executive.

A more detailed study of the shareholder registry showed us that 2 of the top shareholders have a considerable amount of ownership in the company, via their 51% stake.

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 is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Nucleus Software Exports

The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.

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 Nucleus Software Exports Limited. Insiders own ₹11b worth of shares in the ₹38b company. 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

The general public-- including retail investors -- own 21% 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

Our data indicates that Private Companies hold 45%, of the company's shares. It might be worth looking deeper into this. If related parties, such as insiders, have an interest in one of these private companies, that should be disclosed in the annual report. Private companies may also have a strategic interest in the 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 Nucleus Software Exports 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.