Vijaya Diagnostic Centre Limited's (NSE:VIJAYA) most bullish insider, CEO Sura Reddy must be pleased with the recent 17% gain

editorial-team@simplywallst.com (Simply Wall St)

Sun, Nov 17, 2024, 6:10 PM 4 min read

If you want to know who really controls Vijaya Diagnostic Centre Limited (NSE:VIJAYA), then you'll have to look at the makeup of its share registry. We can see that individual insiders own the lion's share in the company with 54% ownership. That is, the group stands to benefit the most if the stock rises (or lose the most if there is a downturn).

As a result, insiders were the biggest beneficiaries of last week’s 17% gain.

Let's take a closer look to see what the different types of shareholders can tell us about Vijaya Diagnostic Centre.

See our latest analysis for Vijaya Diagnostic Centre

ownership-breakdown — NSEI:VIJAYA Ownership Breakdown November 25th 2024

What Does The Institutional Ownership Tell Us About Vijaya Diagnostic Centre?

Many institutions measure their performance against an index that approximates the local market. So they usually pay more attention to companies that are included in major indices.

We can see that Vijaya Diagnostic Centre does have institutional investors; and they hold a good portion of the company's stock. 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. 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 Vijaya Diagnostic Centre's historic earnings and revenue below, but keep in mind there's always more to the story.

earnings-and-revenue-growth — NSEI:VIJAYA Earnings and Revenue Growth November 25th 2024

Vijaya Diagnostic Centre is not owned by hedge funds. Looking at our data, we can see that the largest shareholder is the CEO Sura Reddy with 33% of shares outstanding. For context, the second largest shareholder holds about 8.9% of the shares outstanding, followed by an ownership of 8.4% by the third-largest shareholder. Note that two of the top three shareholders are also Chief Executive Officer and Member of the Board of Directors, respectively, once again pointing to significant ownership by company insiders.

After doing some more digging, we found that the top 4 shareholders control more than half of the company's shares which essentially means that there is concentrated ownership amongst the top shareholders, most of whom happen to be insiders!

While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiments to know which way the wind is blowing. There are a reasonable number of analysts covering the stock, so it might be useful to find out their aggregate view on the future.

Insider Ownership Of Vijaya Diagnostic Centre

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. Management ultimately answers to the board. However, it is not uncommon for managers to be executive board members, especially if they are a founder or the CEO.

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.

Our most recent data indicates that insiders own the majority of Vijaya Diagnostic Centre Limited. This means they can collectively make decisions for the company. Insiders own ₹67b worth of shares in the ₹125b company. That's extraordinary! Most would argue this is a positive, showing strong alignment with shareholders. You can click here to see if they have been selling down their stake.

General Public Ownership

The general public-- including retail investors -- own a stake of less than 3%. This is very low, making them a very small group of shareholders in Vijaya Diagnostic Centre. So they don't have much influence on the company, and the shares may not be actively traded.

Next Steps:

While it is well worth considering the different groups that own a company, there are other factors that are even more important.

Many find it useful to take an in depth look at how a company has performed in the past. You can access this detailed graph of past earnings, revenue and cash flow.

Ultimately the future is most important. You can access this free report on analyst forecasts for the company.

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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com

Simply Wall St analyst Simply Wall St and Simply Wall St have no position in any of the companies mentioned. This article is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.

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