Nasdaq
华尔街日报With 36% stake, The Ramco Cements Limited (NSE:RAMCOCEM) seems to have captured institutional investors' interest
Key Insights
- Significantly high institutional ownership implies Ramco Cements' stock price is sensitive to their trading actions
- A total of 6 investors have a majority stake in the company with 51% ownership
- Using data from analyst forecasts alongside ownership research, one can better assess the future performance of a company
A look at the shareholders of The Ramco Cements Limited (NSE:RAMCOCEM) can tell us which group is most powerful. The group holding the most number of shares in the company, around 36% to be precise, is institutions. In other words, the group stands to gain the most (or lose the most) from their investment into the company.
Since institutional have access to huge amounts of capital, their market moves tend to receive a lot of scrutiny by retail or individual investors. Hence, having a considerable amount of institutional money invested in a company is often regarded as a desirable trait.
Let's delve deeper into each type of owner of Ramco Cements, beginning with the chart below.
Check out our latest analysis for Ramco Cements
What Does The Institutional Ownership Tell Us About Ramco Cements?
Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.
We can see that Ramco Cements 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. 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 Ramco Cements' earnings history below. Of course, the future is what really matters.
We note that hedge funds don't have a meaningful investment in Ramco Cements. Ramco Industries Limited is currently the company's largest shareholder with 22% of shares outstanding. Meanwhile, the second and third largest shareholders, hold 14% and 6.6%, of the shares outstanding, respectively.
On further inspection, we found that more than half the company's shares are owned by the top 6 shareholders, suggesting that the interests of the larger shareholders are balanced out to an extent by the smaller ones.
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 plenty of analysts covering the stock, so it might be worth seeing what they are forecasting, too.
Insider Ownership Of Ramco Cements
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.
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.
Shareholders would probably be interested to learn that insiders own shares in The Ramco Cements Limited. It is a pretty big company, so it is generally a positive to see some potentially meaningful alignment. In this case, they own around ₹8.5b worth of shares (at current prices). If you would like to explore the question of insider alignment, you can click here to see if insiders have been buying or selling.
General Public Ownership
The general public, who are usually individual investors, hold a 18% stake in Ramco Cements. 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.
Private Company Ownership
Our data indicates that Private Companies hold 3.7%, of the company's shares. 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
It appears to us that public companies own 35% of Ramco Cements. 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 Ramco Cements better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Ramco Cements you should be aware of, and 1 of them can't be ignored.
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.