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A look at the shareholders of Rama Steel Tubes Limited (NSE:RAMASTEEL) can tell us which group is most powerful. Generally speaking, as a company grows, institutions will increase their ownership. Conversely, insiders often decrease their ownership over time. I generally like to see some degree of insider ownership, even if only a little. As Nassim Nicholas Taleb said, 'Don’t tell me what you think, tell me what you have in your portfolio.
Rama Steel Tubes is not a large company by global standards. It has a market capitalization of ₹992m, which means it wouldn't have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions don't own many shares in the company. We can zoom in on the different ownership groups, to learn more about RAMASTEEL.
See our latest analysis for Rama Steel Tubes
What Does The Institutional Ownership Tell Us About Rama Steel Tubes?
Institutional investors commonly compare their own returns to the returns of a commonly followed index. So they generally do consider buying larger companies that are included in the relevant benchmark index.
Since institutions own under 5% of Rama Steel Tubes, many may not have spent much time considering the stock. But it's clear that some have; and they liked it enough to buy in. If the business gets stronger from here, we could see a situation where more institutions are keen to buy. We sometimes see a rising share price when a few big institutions want to buy a certain stock at the same time. The history of earnings and revenue, which you can see below, could be helpful in considering if more institutional investors will want the stock. Of course, there are plenty of other factors to consider, too.
We note that hedge funds don't have a meaningful investment in Rama Steel Tubes. Our information suggests that there isn't any analyst coverage of the stock, so it is probably little known.
Insider Ownership Of Rama Steel Tubes
The definition of an insider can differ slightly between different countries, but members of the board of directors always count. 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.
It seems that insiders own more than half the Rama Steel Tubes Limited stock. This gives them a lot of power. So they have a ₹766m stake in this ₹992m business. It is good to see this level of investment. You can check here to see if those insiders have been buying recently.