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Every investor in Jindal Stainless Limited (NSE:JSL) should be aware of the most powerful shareholder groups. Institutions often own shares in more established companies, while it’s not unusual to see insiders own a fair bit of smaller companies. Companies that have been privatized tend to have low insider ownership.
Jindal Stainless is not a large company by global standards. It has a market capitalization of ₹25.9b, which means it wouldn’t have the attention of many institutional investors. In the chart below below, we can see that institutions are noticeable on the share registry. Let’s take a closer look to see what the different types of shareholder can tell us about JSL.
Check out our latest analysis for Jindal Stainless
What Does The Institutional Ownership Tell Us About Jindal Stainless?
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.
As you can see, institutional investors own 21% of Jindal Stainless. This can indicate that the company has a certain degree of credibility in the investment community. However, it is best to be wary of relying on the supposed validation that comes with institutional investors. They too, get it wrong sometimes. When multiple institutions own a stock, there’s always a risk that they are in a ‘crowded trade’. When such a trade goes wrong, multiple parties may compete to sell stock fast. This risk is higher in a company without a history of growth. You can see Jindal Stainless’s historic earnings and revenue, below, but keep in mind there’s always more to the story.
We note that hedge funds don’t have a meaningful investment in Jindal Stainless. Quite a few analysts cover the stock, so you could look into forecast growth quite easily.
Insider Ownership Of Jindal Stainless
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.
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.
I can report that insiders do own shares in Jindal Stainless Limited. In their own names, insiders own ₹423m worth of stock in the ₹25.9b company. This shows at least some alignment. You can click here to see if those insiders have been buying or selling.