Institutions profited after Aditya Birla Real Estate Limited’s (NSE:ABREL) market cap rose ₹39b last week but public companies profited the most

Key Insights

• The considerable ownership by public companies in Aditya Birla Real Estate indicates that they collectively have a greater say in management and business strategy
• A total of 4 investors have a majority stake in the company with 52% ownership
• Institutions own 29% of Aditya Birla Real Estate

Every investor in Aditya Birla Real Estate Limited (NSE:ABREL) should be aware of the most powerful shareholder groups. The group holding the most number of shares in the company, around 35% to be precise, is public companies. Put another way, the group faces the maximum upside potential (or downside risk).

Public companies gained the most after market cap touched ₹341b last week, while institutions who own 29% also benefitted.

In the chart below, we zoom in on the different ownership groups of Aditya Birla Real Estate.

View our latest analysis for Aditya Birla Real Estate

What Does The Institutional Ownership Tell Us About Aditya Birla Real Estate?

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.

As you can see, institutional investors have a fair amount of stake in Aditya Birla Real Estate. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Aditya Birla Real Estate’s earnings history below. Of course, the future is what really matters.

Hedge funds don’t have many shares in Aditya Birla Real Estate. Our data shows that Pilani Investment and Industries Corporation Limited is the largest shareholder with 33% of shares outstanding. With 10.0% and 6.8% of the shares outstanding respectively, IGH Holdings Private Limited and Birla Group Holdings Private Limited, Asset Management Arm are the second and third largest shareholders.

On looking further, we found that 52% of the shares are owned by the top 4 shareholders. In other words, these shareholders have a meaningful say in the decisions of the company.

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 is a little analyst coverage of the stock, but not much. So there is room for it to gain more coverage.

Insider Ownership Of Aditya Birla Real Estate

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. Company management run the business, but the CEO will answer to the board, even if he or she is a member of it.

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.

We can report that insiders do own shares in Aditya Birla Real Estate Limited. This is a big company, so it is good to see this level of alignment. Insiders own ₹6.8b 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

With a 21% ownership, the general public, mostly comprising of individual investors, have some degree of sway over Aditya Birla Real Estate. 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 12%, of the company’s shares. 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.

Public Company Ownership

It appears to us that public companies own 35% of Aditya Birla Real Estate. We can’t be certain but it is quite possible this is a strategic stake. The businesses may be similar, or work together.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important. To that end, you should be aware of the 1 warning sign we’ve spotted with Aditya Birla Real Estate .

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

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.