Key Insights
The significant ownership of listed companies in L&T Technology Services indicates that the companies collectively have a greater say in management and business strategy. 74% of the company is held by a single shareholder (Larsen & Toubro Limited). Insiders have recently sold.
If you want to know who really controls L&T Technology Services Limited ( NSE:LTTS ), then you'll have to look at the makeup of the company's shareholder registry. The group that holds the largest amount of shares in the company (about 74% to be exact) are public companies. In other words, the group that will gain the most (or lose the most) from investing in the company.
The stock price rose 6.3% last week, with listed companies benefiting the most, but institutional investors, who hold 14% of the stock, are also set to benefit from the rise.
Let's take a closer look at each type of owner for L&T Technology Services in the table below.
Read our latest analysis for L&T Technology Services
NSEI:LTTS Ownership Breakdown August 19, 2024
What does institutional ownership tell us about L&T Technology Services?
Institutions typically compare their own performance against a benchmark when reporting to their own investors, so when a stock is included in a major index, they often increase their interest in that stock. You can expect most companies to have some institutional investors on the register, especially if they are growing.
L&T Technology Services already has institutional investors on the share registry. In fact, institutional investors hold a significant amount of shares in the company. This suggests that there is some credibility among professional investors. However, you can't rely on this fact alone, as, like everyone, institutions make bad investments sometimes. It's not uncommon to see a big share price drop when two large institutional investors try to sell a stock at the same time. It's therefore worth looking at the past earnings trajectory of L&T Technology Services (below). Of course, remember that there are other factors to consider, too.
NSEI:LTTS Revenue and Sales Growth August 19, 2024
Hedge funds don't have many holdings in L&T Technology Services Ltd. Our data shows that Larsen & Toubro Ltd is the largest shareholder with 74% of shares outstanding. This basically means they have significant influence, even if they don't have complete control, over the company's future. Life Insurance Corporation of India, Asset Management Arm, and Seafarer Capital Partners LLC are the second and third largest shareholders, holding 6.8% and 1.4% of shares outstanding, respectively.
While it makes sense to study institutional ownership data for a company, it also makes sense to study analyst sentiment to know which way the wind is blowing. There are a fair number of analysts covering the stock, so you can look up forecast growth fairly easily.
Insider Ownership of L&T Technology Services
While the precise definition of an insider can be subjective, almost everyone considers directors to be insiders. A company's management should report to the board of directors, which should represent the interests of shareholders. Notably, top-level managers themselves may sit on the board of directors.
I generally consider insider ownership to be a good thing, but in some cases it can make it difficult for other shareholders to hold the board to account for decisions.
Our most recent data indicates that insiders own less than 1% of L&T Technology Services Limited shares. As it's a large company, even a small percentage of ownership could give rise to a board and shareholder settlement. In this case, insiders own ₹3.9b worth of shares. It's always good to see at least some insider ownership, but it might be worth checking if those insiders have been selling.
General public property
The general public (including retail investors) own 11% of the company's shares, so it can't be easily ignored, and while this group doesn't necessarily have the decision-making power, it certainly has a real influence on how the company is run.
Public Company Ownership
It appears that listed companies own 74% of L&T Technology Services. While it's hard to say for sure, this suggests that the business interests of the two companies are intertwined. This could be a strategic interest, so it's worth keeping an eye on this area for any changes in ownership.
Next steps:
While it is well worth considering the different groups that own a company, there are other factors that are even more important, and to that end, you should be aware of the 2 warning signs we've spotted with L&T Technology Services.
If you're like me, you might want to think about whether the company is likely to grow or shrink, and luckily you can check this free report showing analyst forecasts for the company in the future.
Note: The figures in this article are calculated using data from the last 12 months, which refers to the 12-month period ending on the last day of the month in which the financial statements are dated, which may not match the figures in the annual report.
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This article by Simply Wall St is of general nature. We provide commentary based on historical data and analyst forecasts using only unbiased methodology, and our articles are not intended as financial advice. It is not a recommendation to buy or sell a stock, and does not take into account your objectives or financial situation. We aim to provide long-term analysis driven by fundamental data. Please note that our analysis may not take into account the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any of the stocks mentioned herein.
