How Much Of Tata Coffee Limited (NSE:TATACOFFEE) Do Institutions Own?

Becky Mayes

Sat, Feb 9, 2019, 7:09 PM

A look at the shareholders of Tata Coffee Limited (NSE:TATACOFFEE) can tell us which group is most powerful. 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.

Tata Coffee is not a large company by global standards. It has a market capitalization of ₹16b, which means it wouldn’t have the attention of many institutional investors. Our analysis of the ownership of the company, below, shows that institutions own shares in the company. Let’s delve deeper into each type of owner, to discover more about TATACOFFEE.

Check out our latest analysis for Tata Coffee

NSEI:TATACOFFEE Ownership Summary February 10th 19

What Does The Institutional Ownership Tell Us About Tata Coffee?

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.

Tata Coffee already has institutions on the share registry. Indeed, they own 7.8% of the company. This implies the analysts working for those institutions have looked at the stock and they like it. But just like anyone else, they could be wrong. 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 Tata Coffee’s historic earnings and revenue, below, but keep in mind there’s always more to the story.

NSEI:TATACOFFEE Income Statement Export February 10th 19

Tata Coffee is not owned by hedge funds. Our information suggests that there isn’t any analyst coverage of the stock, so it is probably little known.

Insider Ownership Of Tata Coffee

The definition of company insiders can be subjective, and does vary between jurisdictions. Our data reflects individual insiders, capturing board members at the very least. 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 information suggests that Tata Coffee Limited insiders own under 1% of the company. But they may have an indirect interest through a corporate structure that we haven’t picked up on. It seems the board members have no more than ₹88m worth of shares in the ₹16b company. I generally like to see a board more invested. However it might be worth checking if those insiders have been buying.