To get a sense of who actually controls Sun Pharma Advanced Research Company Limited (NSE: SPARC), it is important to understand the ownership structure of the company. And the group that holds the biggest slice of the pie are private companies with 56% ownership. That is, the group is most likely to benefit the most if the stock rises (or to lose the most if there is a decline).
Clearly, private companies have benefited the most after the company’s market capitalization rose 8.3 billion yen last week.
Let’s take a closer look at each type of Sun Pharma Advanced Research owner, starting with the table below.
Check out our latest review for Sun Pharma Advanced Research
What does Institutional Ownership tell us about Sun Pharma’s advanced research?
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 businesses to have some institutions listed, especially if they are growing.
We can see that Sun Pharma Advanced Research has institutional investors; and they own a good portion of the company’s stock. This implies that analysts working for these institutions have reviewed the action and appreciate it. But like everyone else, they could be wrong. When several institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes awry, several parties may compete with each other to sell shares quickly. This risk is higher in a company without a history of growth. You can see Sun Pharma Advanced Research’s historical earnings and revenue below, but keep in mind that there is always more to tell.
We note that hedge funds do not have a significant investment in Sun Pharma Advanced Research. Shanghvi Finance Pvt Ltd is currently the largest shareholder of the company with 52% of the shares outstanding. This implies that they have majority control over the future of the business. With respectively 11% and 3.9% of the shares outstanding, Dilip Shanghvi and Sun Pharmaceutical Industries Ltd., Employee Benefit Trust are the second and third largest shareholders.
While it makes sense to study a company’s institutional ownership data, it also makes sense to study analysts’ sentiments to know which way the wind is blowing. Our information suggests there is no analyst coverage of the stock, so it is likely little known.
Sun Pharma Advanced Research Insider Property
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The management of the company is accountable to the board of directors and the board must represent the interests of the shareholders. Notably, sometimes senior executives themselves sit on the board.
Most view insider ownership as a positive, as it can indicate that the board is well aligned with other shareholders. However, on some occasions too much power is concentrated within this group.
Our information suggests that there are insiders holding a significant stake in Sun Pharma Advanced Research Company Limited. It has a market cap of just 75 billion yen and insiders have 12 billion yen of shares in their own name. It is quite important. Most would say it shows a good degree of alignment with shareholders, especially in a company of this size. You can click here to see if these insiders have bought or sold.
General public property
The general public, who are typically individual investors, own a 20% stake in Sun Pharma Advanced Research. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in line with other large shareholders.
Owned by a private company
Our data indicates that private companies own 56% of the company’s shares. It might be worth pursuing the matter further. If related parties, such as insiders, have an interest in any of these private companies, this should be disclosed in the annual report. Private companies may also have a strategic interest in the business.
While it is worth considering the different groups that own a business, there are other factors that are even more important. Consider risks, for example. Every business has them, and we’ve spotted 2 warning signs for Sun Pharma’s advanced research you should know.
If you would rather consult with another company – one with potentially superior finances – then don’t miss this free list of interesting companies, supported by solid financial data.
NB: The figures in this article are calculated from data for the last twelve months, which refer to the 12-month period ending on the last date of the month of date of the financial statement. This may not be consistent with the figures in the annual report for the entire year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts using only 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 into account your goals or your financial situation. Our aim is to bring you long-term, targeted analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price sensitive companies or qualitative documents. Simply Wall St has no position in any of the stocks mentioned.