If you want to know who actually controls Bharti Airtel Limited (NSE: BHARTIARTL), you will need to look at the composition of its share register. And the group that holds the biggest slice of the pie are private companies with 43% ownership. In other words, the group is likely to gain the most (or lose the most) from its investment in the business.
Institutions, for their part, represent 30% of the company’s shareholders. Institutions often own shares in larger companies, and we expect to see insiders owning a noticeable percentage of smaller ones.
Let’s take a closer look at what different types of shareholders can tell us about Bharti Airtel.
If you are not interested in researching BHARTIARTL’s ownership structure, we have a free list of interesting investment ideas to potentially inspire your next investment!
What does institutional ownership tell us about Bharti Airtel?
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.
Bharti Airtel already has institutions registered in the share register. Indeed, they hold a respectable stake in the company. This suggests some credibility with professional investors. But we cannot rely solely on this fact since institutions sometimes make bad investments, like everyone else. When multiple institutions hold a stock, there is always a risk that they are in a “crowded trade”. When such a transaction goes wrong, multiple parties may compete to quickly sell shares. This risk is higher in a company with no history of growth. You can see Bharti Airtel’s historical revenue and earnings below, but keep in mind there’s always more to the story.
Hedge funds don’t have a lot of shares in Bharti Airtel. Bharti Enterprises Limited is currently the largest shareholder, with 43% of the outstanding shares. In comparison, the second and third shareholders hold around 12% and 1.5% of the shares.
After digging a little deeper, we found that the 2 major shareholders collectively control more than half of the company’s shares, implying that they have considerable power to influence company decisions.
Institutional ownership research is a good way to assess and filter the expected performance of a stock. The same can be obtained by studying the feelings of the analyst. There are plenty of analysts covering the stock, so it might be interesting to see what they are predicting as well.
Bharti Airtel Insider Ownership
The definition of an insider may differ slightly from country to country, but board members still matter. The management of the company runs the company, but the CEO will answer to the board of directors, even if he is a member of it.
I generally consider insider ownership to be a good thing. However, there are times when it is more difficult for other shareholders to hold the board accountable for decisions.
Our information suggests that insiders of Bharti Airtel Limited own less than 1% of the company. However, insiders may have an indirect interest through a more complex structure. It’s a very big company, so it would be surprising to see insiders owning much of the company. Although their stake is less than 1%, we can see that the board members collectively own 1.4 billion shares (at current prices). It’s always good to see at least some insider ownership, but it might be worth checking to see if those insiders have sold.
General public property
With a 15% stake, the general public, consisting mainly of individual investors, has some influence over Bharti Airtel. Although this group may not necessarily make the decisions, they can certainly have a real influence on the way the business is run.
Private Company Ownership
It seems that private companies own 43% of the shares of Bharti Airtel. It might be worth exploring this further. If related parties, such as insiders, have an interest in any of these private companies, this should be disclosed in the annual report. Private companies may also have a strategic interest in the company.
Ownership of a public company
It seems to us that public companies own 12% of Bharti Airtel. It’s hard to say for sure, but it suggests they have intertwined business interests. This could be a strategic stake, so it’s worth monitoring this space for ownership changes.
It is always useful to think about the different groups that own shares in a company. But to better understand Bharti Airtel, we need to consider many other factors. Example: we have identified 3 warning signs for Bharti Airtel you should be aware of, and 1 of them is potentially serious.
But finally it’s the future, not the past, which will determine the performance of the owners of this company. Therefore, we think it’s advisable to take a look at this free report showing whether analysts are predicting a brighter future.
NB: The figures in this article are calculated using trailing twelve month data, which refers to the 12 month period ending on the last day of the month the financial statements are dated. This may not be consistent with the annual report figures for the full year.
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This Simply Wall St article is general in nature. We provide commentary based on historical data and analyst forecasts only using unbiased methodology and our articles are not intended to be financial advice. It is not a recommendation to buy or sell stocks and does not take into account your objectives or financial situation. Our goal is to bring you targeted long-term analysis based on fundamental data. Note that our analysis may not take into account the latest announcements from price-sensitive companies or qualitative materials. Simply Wall St has no position in the stocks mentioned.
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