Engineering & Capital Goods News

The recent pullback must have dismayed Thejo Engineering Limited (NSE:THEJO) insiders who own 65% of the company


If you want to know who really controls Thejo Engineering Limited (NSE:THEJO), then you’ll have to look at the makeup of its share registry. And the group that holds the biggest piece of the pie are individual insiders with 65% ownership. In other words, the group stands to gain the most (or lose the most) from their investment into the company.

And following last week’s 13% decline in share price, insiders suffered the most losses.

Let’s delve deeper into each type of owner of Thejo Engineering, beginning with the chart below.

Check out our latest analysis for Thejo Engineering

NSEI:THEJO Ownership Breakdown June 21st 2022

What Does The Lack Of Institutional Ownership Tell Us About Thejo Engineering?

Institutional investors often avoid companies that are too small, too illiquid or too risky for their tastes. But it’s unusual to see larger companies without any institutional investors.

There are many reasons why a company might not have any institutions on the share registry. It may be hard for institutions to buy large amounts of shares, if liquidity (the amount of shares traded each day) is low. If the company has not needed to raise capital, institutions might lack the opportunity to build a position. On the other hand, it’s always possible that professional investors are avoiding a company because they don’t think it’s the best place for their money. Institutional investors may not find the historic growth of the business impressive, or there might be other factors at play. You can see the past revenue performance of Thejo Engineering, for yourself, below.

earnings-and-revenue-growth
NSEI:THEJO Earnings and Revenue Growth June 21st 2022

Hedge funds don’t have many shares in Thejo Engineering. Girish Gulati is currently the company’s largest shareholder with 7.8% of shares outstanding. For context, the second largest shareholder holds about 7.1% of the shares outstanding, followed by an ownership of 6.2% by the third-largest shareholder. Thomas John, who is the third-largest shareholder, also happens to hold the title of Vice Chairman. Furthermore, CEO Manoj Joseph is the owner of 4.7% of the company’s shares.

We also observed that the top 9 shareholders account for more than half of the share register, with a few smaller shareholders to balance the interests of the larger ones to a certain extent.

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. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.

Insider Ownership Of Thejo Engineering

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. 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.

Insider ownership is positive when it signals leadership are thinking like the true owners of the company. However, high insider ownership can also give immense power to a small group within the company. This can be negative in some circumstances.

It seems that insiders own more than half the Thejo Engineering Limited stock. This gives them a lot of power. So they have a ₹5.6b stake in this ₹8.6b business. Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if those insiders have been buying or selling.

General Public Ownership

The general public– including retail investors — own 35% stake in the company, and hence can’t easily be ignored. While this group can’t necessarily call the shots, it can certainly have a real influence on how the company is run.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. Take risks for example – Thejo Engineering has 1 warning sign we think you should be aware of.

Of course this may not be the best stock to buy. Therefore, you may wish to see our free collection of interesting prospects boasting favorable financials.

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.

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.



Source link

Leave a Comment