Private companies are Syrma SGS Technology Limited's (NSE:SYRMA) biggest owners and were hit after market cap dropped ₹7.1b

Key Insights

• The considerable ownership by private companies in Syrma SGS Technology indicates that they collectively have a greater say in management and business strategy
• 57% of the business is held by the top 4 shareholders
• 29% of Syrma SGS Technology is held by insiders

A look at the shareholders of Syrma SGS Technology Limited (NSE:SYRMA) can tell us which group is most powerful. And the group that holds the biggest piece of the pie are private companies with 39% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

Following a 5.9% decrease in the stock price last week, private companies suffered the most losses, but insiders who own 29% stock also took a hit.

In the chart below, we zoom in on the different ownership groups of Syrma SGS Technology.

View our latest analysis for Syrma SGS Technology

What Does The Institutional Ownership Tell Us About Syrma SGS Technology?

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.

We can see that Syrma SGS Technology does have institutional investors; and they hold a good portion of the company's stock. 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. It is not uncommon to see a big share price drop if two large institutional investors try to sell out of a stock at the same time. So it is worth checking the past earnings trajectory of Syrma SGS Technology, (below). Of course, keep in mind that there are other factors to consider, too.

We note that hedge funds don't have a meaningful investment in Syrma SGS Technology. Looking at our data, we can see that the largest shareholder is Tandon Technology Ventures with 36% of shares outstanding. The second and third largest shareholders are Krishna Pant and Jasbir Gujral, with an equal amount of shares to their name at 7.1%. Two of the top three shareholders happen to be Top Key Executive and Member of the Board of Directors, respectively. That is, insiders feature higher up in the heirarchy of the company's top shareholders.

To make our study more interesting, we found that the top 4 shareholders control more than half of the company which implies that this group has considerable sway over the company's decision-making.

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 Syrma SGS Technology

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

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.

It seems insiders own a significant proportion of Syrma SGS Technology Limited. Insiders own ₹32b worth of shares in the ₹112b company. That's quite meaningful. 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 14% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Syrma SGS Technology. While this size of ownership may not be enough to sway a policy decision in their favour, they can still make a collective impact on company policies.

Private Company Ownership

We can see that Private Companies own 39%, of the shares on issue. It's hard to draw any conclusions from this fact alone, so its worth looking into who owns those private companies. Sometimes insiders or other related parties have an interest in shares in a public company through a separate private 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. For instance, we've identified 1 warning sign for Syrma SGS Technology that you should be aware of.

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.