Insiders were the key beneficiaries as Aimtron Electronics Limited's (NSE:AIMTRON) market cap rises to ₹12b

Key Insights

• Aimtron Electronics' significant insider ownership suggests inherent interests in company's expansion
• Mukesh Vasani owns 65% of the company
• Past performance of a company along with ownership data serve to give a strong idea about prospects for a business

To get a sense of who is truly in control of Aimtron Electronics Limited (NSE:AIMTRON), it is important to understand the ownership structure of the business. With 71% stake, individual insiders possess the maximum shares in the company. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Clearly, insiders benefitted the most after the company's market cap rose by ₹1.2b last week.

Let's delve deeper into each type of owner of Aimtron Electronics, beginning with the chart below.

See our latest analysis for Aimtron Electronics

What Does The Lack Of Institutional Ownership Tell Us About Aimtron Electronics?

We don't tend to see institutional investors holding stock of companies that are very risky, thinly traded, or very small. Though we do sometimes see large companies without institutions on the register, it's not particularly common.

There are multiple explanations for why institutions don't own a stock. The most common is that the company is too small relative to funds under management, so the institution does not bother to look closely at the company. It is also possible that fund managers don't own the stock because they aren't convinced it will perform well. Aimtron Electronics might not have the sort of past performance institutions are looking for, or perhaps they simply have not studied the business closely.

We note that hedge funds don't have a meaningful investment in Aimtron Electronics. The company's largest shareholder is Mukesh Vasani, with ownership of 65%. This essentially means that they have extensive influence, if not outright control, over the future of the corporation. Nirmal Vasani is the second largest shareholder owning 5.8% of common stock, and Sharmilaben Bambhaniya holds about 0.03% of the company stock. Sharmilaben Bambhaniya, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

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. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Aimtron Electronics

While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. 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 information suggests that insiders own more than half of Aimtron Electronics Limited. This gives them effective control of the company. Given it has a market cap of ₹12b, that means they have ₹8.8b 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

With a 29% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Aimtron Electronics. 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.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Aimtron Electronics better, we need to consider many other factors. Take risks for example - Aimtron Electronics has 1 warning sign we think 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.