Public companies among Vodafone Idea Limited's (NSE:IDEA) largest shareholders, saw gain in holdings value after stock jumped 6.5% last week

Key Insights

• Significant control over Vodafone Idea by public companies implies that the general public has more power to influence management and governance-related decisions
• 53% of the business is held by the top 3 shareholders
• 11% of Vodafone Idea is held by Institutions

To get a sense of who is truly in control of Vodafone Idea Limited (NSE:IDEA), it is important to understand the ownership structure of the business. With 31% stake, public companies possess the maximum shares in the company. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

As a result, public companies collectively scored the highest last week as the company hit ₹679b market cap following a 6.5% gain in the stock.

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

See our latest analysis for Vodafone Idea

What Does The Institutional Ownership Tell Us About Vodafone Idea?

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.

As you can see, institutional investors have a fair amount of stake in Vodafone Idea. 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 Vodafone Idea's earnings history below. Of course, the future is what really matters.

We note that hedge funds don't have a meaningful investment in Vodafone Idea. The company's largest shareholder is Vodafone Group Public Limited Company, with ownership of 24%. For context, the second largest shareholder holds about 23% of the shares outstanding, followed by an ownership of 6.2% by the third-largest shareholder. Kumar Birla, who is the third-largest shareholder, also happens to hold the title of Member of the Board of Directors.

After doing some more digging, we found that the top 3 shareholders collectively control more than half of the company's shares, implying that they have considerable power to influence the company's decisions.

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 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 Vodafone Idea

The definition of company insiders can be subjective and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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.

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.

Shareholders would probably be interested to learn that insiders own shares in Vodafone Idea Limited. This is a big company, so it is good to see this level of alignment. Insiders own ₹42b worth of shares (at current prices). It is good to see this level of investment by insiders. You can check here to see if those insiders have been buying recently.

General Public Ownership

The general public, who are usually individual investors, hold a 25% stake in Vodafone Idea. While this group can't necessarily call the shots, it can certainly have a real influence on how the company is run.

Private Company Ownership

We can see that Private Companies own 3.8%, 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.

Public Company Ownership

Public companies currently own 31% of Vodafone Idea stock. It's hard to say for sure but this suggests they have entwined business interests. This might be a strategic stake, so it's worth watching this space for changes in ownership.

Next Steps:

It's always worth thinking about the different groups who own shares in a company. But to understand Vodafone Idea better, we need to consider many other factors. Take risks for example - Vodafone Idea has 4 warning signs (and 2 which don't sit too well with us) we think you should know about.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.