Every investor in Supreme Petrochem Limited (NSE:SUPPETRO) 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. Warren Buffett said that he likes ‘a business with enduring competitive advantages that is run by able and owner-oriented people’. So it’s nice to see some insider ownership, because it may suggest that management is owner-oriented.
Supreme Petrochem is a smaller company with a market capitalization of ₹23.76b, so it may still be flying under the radar of many institutional investors. In the chart below below, we can see that institutions don’t own many shares in the company. Let’s take a closer look to see what the different types of shareholder can tell us about SUPPETRO.
Check out our latest analysis for Supreme Petrochem
What Does The Institutional Ownership Tell Us About Supreme Petrochem?
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.
Institutions own less than 5% of Supreme Petrochem. That indicates that the company is on the radar of some funds, but it isn’t particularly popular with professional investors at the moment. If the company is growing earnings, that may indicate that it is just beginning to catch the attention of these deep-pocketed investors. It is not uncommon to see a big share price rise if multiple institutional investors are trying to buy into a stock at the same time. So check out the historic earnings trajectory, below, but keep in mind it’s the future that counts most.
Supreme Petrochem is not owned by hedge funds. We’re not picking up on any analyst coverage of the stock at the moment, so the company is unlikely to be widely held.
Insider Ownership Of Supreme Petrochem
While the precise definition of an insider can be subjective, almost everyone considers board members to be insiders. The company management answer to the board; and the latter should represent the interests of shareholders. Notably, sometimes top-level managers are on the board, themselves.
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.
We can see that insiders own shares in Supreme Petrochem Limited. It has a market capitalization of just ₹23.76b, and insiders have ₹1.46b worth of shares, in their own names. Some would say this shows alignment of interests between shareholders and the board. But it might be worth checking if those insiders have been selling.