If you want to know who really controls Reliance Infrastructure Limited (

NSE:RELINFRA

),zamzows on fairview then you’ll have to look at the makeup of its share registry. Insiders often own a large chunk of younger, smaller, companies while huge companies tend to have institutions as shareholders. Companies that used to be publicly owned tend to have lower insider ownership.

Reliance Infrastructure has a market capitalization of ₹79b, so we would expect some institutional investors to have noticed the stock. Our analysis of the ownership of the company, below, shows that institutional investors have bought into the company. We can zoom in on the different ownership groups, to learn more about RELINFRA.

Check out our latest analysis for Reliance Infrastructure

NSEI:RELINFRA Ownership Summary January 2nd 19

What Does The Institutional Ownership Tell Us About Reliance Infrastructure?

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 30% of Reliance Infrastructure. This suggests some credibility amongst professional investors. But we can’t rely on that fact alone, since institutions make bad investments sometimes, just like everyone does. If multiple institutions change their view on a stock at the same time, you could see the share price drop fast. It’s therefore worth looking at Reliance Infrastructure’s earnings history, below. Of course, the future is what really matters.

NSEI:RELINFRA Income Statement Export January 2nd 19

We note that hedge funds don’t have a meaningful investment in Reliance Infrastructure. There is some analyst coverage of the stock, but it could still become more well known, with time.

Insider Ownership Of Reliance Infrastructure

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.

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.

Our data suggests that insiders own under 1% of Reliance Infrastructure Limited in their own names. We do note, however, it is possible insiders have an indirect interest through a private company or other corporate structure. It is a pretty big company, so it would be possible for board members to own a meaningful interest in the company, without owning much of a proportional interest. In this case, they own around ₹207m worth of shares (at current prices). Arguably, recent buying and selling is just as important to consider. You can

click here to see if insiders have been buying or selling.

Story continues

General Public Ownership

With a 11% ownership, the general public have some degree of sway over RELINFRA. This size of ownership, while considerable, may not be enough to change company policy if the decision is not in sync with other large shareholders.

Private Company Ownership

We can see that Private Companies own 57%, of the shares on issue. Private companies may be related parties. Sometimes insiders have an interest in a public company through a holding in a private company, rather than in their own capacity as an individual. While it’s hard to draw any broad stroke conclusions, it is worth noting as an area for further research.

Next Steps:

It’s always worth thinking about the different groups who own shares in a company. But to understand Reliance Infrastructure better, we need to consider many other factors.

I like to dive deeper

into how a company has performed in the past. You can find

historic revenue and earnings in this

detailed graph

.

But ultimately

it is the future

, not the past, that will determine how well the owners of this business will do. Therefore we think it advisable to take a look at

this free report showing whether analysts are predicting a brighter future

.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at

[email protected]

.

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