The Indian market has experienced a notable uptick over the past year, increasing by 38%, despite a recent dip of 1.7% in the last seven days. In this context, companies with high insider ownership can be particularly compelling as they often suggest a strong alignment between company management and shareholder interests, especially in an environment where earnings are expected to grow by 16% annually.
Top 10 Growth Companies With High Insider Ownership In India
Overview: AU Small Finance Bank Limited offers a range of banking and financial services across India, with a market capitalization of approximately ₹497.43 billion.
Operations: The bank's revenue is primarily derived from three segments: Treasury (₹17.04 billion), Retail Banking (₹91.18 billion), and Wholesale Banking (₹11.61 billion).
Insider Ownership: 24.3%
Revenue Growth Forecast: 24.9% p.a.
AU Small Finance Bank, despite recent regulatory penalties, including a INR 5,000 fine for procedural lapses in note exchange and a INR 0.091 million GST-related penalty, continues to show robust financial performance with a net income increase to INR 15.35 billion this year from INR 14.28 billion last year. The bank's high insider ownership aligns interests with shareholders but faces challenges like shareholder dilution over the past year and modest forecasted Return on Equity of 16.9%. Nevertheless, revenue is expected to outpace the Indian market significantly at an annual growth rate of 24.9%.
Overview: Heritage Foods Limited, operating in India, is involved in the procurement and processing of milk and milk products with a market capitalization of approximately ₹50.71 billion.
Operations: The company generates revenue primarily from its Dairy segment at ₹36.06 billion, with additional income from Feed and Renewable Energy segments amounting to ₹1.48 billion and ₹0.09 billion respectively.
Insider Ownership: 37.2%
Revenue Growth Forecast: 11.1% p.a.
Heritage Foods Limited, with high insider ownership, recently confirmed a dividend and reported substantial year-over-year earnings growth. The company's revenue is expected to grow at 11.1% annually, outpacing the Indian market forecast of 9.5%. However, its Return on Equity is projected to remain low at 18.8%, and its share price has been highly volatile in recent months. Despite these challenges, the firm's aggressive expansion with a new UHT Milk plant highlights its growth trajectory and adaptability in product diversification.
Overview: Varun Beverages Limited operates as a franchisee of PepsiCo, producing and distributing carbonated soft drinks and non-carbonated beverages, with a market capitalization of approximately ₹1.94 trillion.
Operations: The company generates ₹164.67 billion from the manufacturing and sale of beverages.
Insider Ownership: 36.4%
Revenue Growth Forecast: 16.3% p.a.
Varun Beverages, marked by high insider ownership, has shown robust financial performance with a 10.27% increase in sales to INR 43.98 billion in Q1 2024. The company's net income also rose significantly to INR 5.37 billion, reflecting strong operational efficiency and market expansion strategies, including the recent setup of a subsidiary in Zimbabwe and a new production facility in Uttar Pradesh. Despite carrying high levels of debt, Varun Beverages is poised for continued growth with earnings expected to surge by 23% annually over the next three years, outpacing the broader Indian market's forecast growth.
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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.The analysis only considers stock directly held by insiders. It does not include indirectly owned stock through other vehicles such as corporate and/or trust entities. All forecast revenue and earnings growth rates quoted are in terms of annualised (per annum) growth rates over 1-3 years.
