Could the ownership structure of PI Industries Limited (NSE: PIIND) tell us anything useful?


A look at the shareholders of PI Industries Limited (NSE: PIIND) can tell us which group is more powerful. Large companies usually have institutions as shareholders, and we usually see insiders holding shares in smaller companies. Warren Buffett said he enjoys “a business with sustainable competitive advantages that is led by skilled, owner-oriented people.” So it’s nice to see some insider ownership as it can suggest that the management is owner-driven.

With a market capitalization of 525 billion yen, PI Industries is pretty big. We would expect to see institutional investors on the register. Companies of this size are also generally well known to retail investors. Looking at our data on ownership groups (below), it appears that institutions own shares in the company. We can zoom in on the different ownership groups, to find out more about PI Industries.

See our latest review for PI Industries

Distribution of the NSEI property: PIIND September 18, 2021

What does institutional ownership tell us about PI Industries?

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.

As you can see, institutional investors have a significant share of PI Industries. This may indicate that the company has a certain degree of credibility in the investment community. However, it is best not to rely on the so-called validation that comes with institutional investors. They too are sometimes 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 stocks quickly. This risk is higher in a company without a history of growth. You can see PI Industries historical revenue and revenue below, but keep in mind that there is always more to tell.

profit and revenue growth
NSEI: PIIND Profit and Revenue Growth September 18, 2021

PI Industries is not owned by hedge funds. Salil Singhal is currently the largest shareholder of the company with 26% of the shares outstanding. Meanwhile, the second and third shareholders respectively hold 21% and 3.8% of the outstanding shares. Mayank Singhal, who is the second shareholder, also holds the title of Senior Key Executive.

After digging a little deeper, we found that the top 3 shareholders collectively control over half of the company’s stock, implying that they have considerable power to influence company decisions.

While studying the institutional ownership of a company can add value to your research, it is also recommended that you research analyst recommendations to better understand the expected performance of a stock. Many analysts cover the stock, so it can be interesting to see what they are forecasting as well.

Insider property of PI Industries

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

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

Our information suggests that insiders retain a significant stake in PI Industries Limited. Insiders own 248 billion yen of shares in the company 525 billion yen. It is quite significant. It’s good to see this level of investment. You can check here if these insiders have bought recently.

General public property

The general public, with a 22% stake in the company, will not be easily overlooked. While this property size may not be enough to influence a policy decision in their favor, they can still have a collective impact on company policies.

Next steps:

I find it very interesting to see who exactly owns a company. But to really get an overview, we have to take other information into account as well.

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

If you are like me, you might want to ask yourself if this business will grow or shrink. Fortunately, you can check out this free report showing analysts’ forecasts for its future.

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.

When trading PI Industries or any other investment, use the platform considered by many to be the gateway for professionals to the global market, Interactive Brokers. You get the cheapest * trading on stocks, options, futures, forex, bonds and funds from around the world from a single integrated account. Promoted

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 shares 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 material. Simply Wall St has no position in the mentioned stocks.
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