Are Insiders Buying Banco Products (India) Limited (NSE:BANCOINDIA) Stock?

We often see insiders buying up shares in companies that perform well over the long term. The flip side of that is that there are more than a few examples of insiders dumping stock prior to a period of weak performance. So before you buy or sell Banco Products (India) Limited (NSE:BANCOINDIA), you may well want to know whether insiders have been buying or selling.

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, rules govern insider transactions, and certain disclosures are required.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise'.

See our latest analysis for Banco Products (India)

The Last 12 Months Of Insider Transactions At Banco Products (India)

In the last twelve months, the biggest single purchase by an insider was when Non-Executive Chairman Mehul Patel bought ₹762m worth of shares at a price of ₹85.00 per share. Although we like to see insider buying, we note that this large purchase was at significantly below the recent price of ₹144. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

Banco Products (India) is not the only stock insiders are buying. So take a peek at this free list of growing companies with insider buying.

Does Banco Products (India) Boast High Insider Ownership?

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. We usually like to see fairly high levels of insider ownership. Banco Products (India) insiders own about ₹7.3b worth of shares (which is 71% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

So What Does This Data Suggest About Banco Products (India) Insiders?

It doesn't really mean much that no insider has traded Banco Products (India) shares in the last quarter. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Banco Products (India) insiders feel good about the company's future. So while it's helpful to know what insiders are doing in terms of buying or selling, it's also helpful to know the risks that a particular company is facing. When we did our research, we found 2 warning signs for Banco Products (India) (1 is a bit unpleasant!) that we believe deserve your full attention.

But note: Banco Products (India) may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

For the purposes of this article, insiders are those individuals who report their transactions to the relevant regulatory body. We currently account for open market transactions and private dispositions, but not derivative transactions.

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This article by Simply Wall St is general in nature. 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. Simply Wall St has no position in any stocks mentioned.
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