What does the ownership structure of Nalwa Sons Investments Limited (NSE: NSIL) look like?

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A look at the shareholders of Nalwa Sons Investments Limited (NSE:NSIL) can tell us which group is the most powerful. Generally speaking, as a company grows, institutions increase their ownership. Conversely, insiders often decrease their ownership over time. I like to see at least a little insider ownership. As Charlie Munger said “Show me the incentive and I’ll show you the result”.

Nalwa Sons Investments is a small company with a market capitalization of ₹9.1 billion, so it may still fly under the radar of many institutional investors. Looking at our ownership group data (below), it appears that institutions own shares in the company. Let’s dig deeper into each type of owner to learn more about Nalwa Sons Investments.

Check out our latest analysis for Nalwa Sons Investments

NSEI: distribution of ownership of NSIL as of April 1, 2022

What does institutional ownership tell us about Nalwa Sons’ investments?

Institutions typically measure themselves against a benchmark when reporting to their own investors, so they often become more enthusiastic about a stock once it is included in a major index. We would expect most companies to have some institutions listed, especially if they are growing.

We can see that Nalwa Sons Investments has institutional investors; and they own a good part of the shares of the company. This implies that analysts working for these institutions have reviewed the stock and like it. But like everyone else, they can be wrong. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Nalwa Sons Investments’ historical earnings and revenue below, but keep in mind there’s always more to tell.

earnings-and-revenue-growth
NSEI: NSIL Earnings and Revenue Growth as of April 1, 2022

We note that hedge funds have no significant investment in Nalwa Sons Investments. Looking at our data, we can see that the largest shareholder is Vistra Holdings S.à rl, Asset Management Arm with 16% of shares outstanding. PRJ Family Management Company Private Limited is the second largest shareholder with 14% of the common shares, and OPJ Trading Private Limited owns about 11% of the shares of the company.

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 a considerable influence on the decision-making of the company.

Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. Our information suggests there is no analyst coverage of the stock, so it is likely little known.

Insider Ownership of Nalwa Sons Investments

The definition of company insiders can be subjective and varies from jurisdiction to jurisdiction. Our data reflects individual insiders, capturing at least board members. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.

Insider ownership is positive when it signals that executives think like the true owners of the company. However, strong insider ownership can also give immense power to a small group within the company. This can be negative in certain circumstances.

Our information suggests that insiders hold a significant stake in Nalwa Sons Investments Limited. Insiders have a ₹1.0 billion stake in this ₹9.1 billion venture. It’s great to see insiders so invested in the company. It might be worth checking to see if these insiders have bought recently.

General public property

The general public, including retail investors, owns 14% of the company’s capital and therefore cannot be easily ignored. While this size of ownership may not be enough to sway a policy decision in their favor, they can still have a collective impact on company policies.

Private Company Ownership

We can see that private companies hold 52% of the issued shares. It’s hard to draw conclusions from this fact alone, so it’s worth investigating who owns these private companies. Sometimes insiders or other related parties have an interest in shares of a public company through a separate private company.

Next steps:

It is always useful to think about the different groups that own shares in a company. But to better understand Nalwa Sons Investments, we need to consider many other factors.

I like to dive deeper on the performance of a company in the past. You can access this interactive chart past earnings, income and cash flow, for free.

Sure this may not be the best stock to buy. Therefore, you may want to see our free set of interesting prospects benefiting from a favorable financial situation.

NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month in which the financial statements are dated. This may not be consistent with the annual report figures for the full year.

This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.

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