Have Insiders Been Buying Jamna Auto Industries Limited (NSE:JAMNAAUTO) Shares?

We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. 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 shareholders might well want to know whether insiders have been buying or selling shares in Jamna Auto Industries Limited (NSE:JAMNAAUTO).

What Is Insider Selling?

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'.

Check out our latest analysis for Jamna Auto Industries

Jamna Auto Industries Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider purchase was by MD, CEO & Executive Director Pradeep Jauhar for ₹7.4m worth of shares, at about ₹36.84 per share. Even though the purchase was made at a significantly lower price than the recent price (₹57.05), we still think insider buying is a positive. Because the shares were purchased at a lower price, this particular buy doesn't tell us much about how insiders feel about the current share price.

Pradeep Jauhar bought 510.65k shares over the last 12 months at an average price of ₹40.78. The chart below shows insider transactions (by companies and individuals) over the last year. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

There are always plenty of stocks that insiders are buying. So if that suits your style you could check each stock one by one or you could take a look at this free list of companies. (Hint: insiders have been buying them).

Insider Ownership of Jamna Auto Industries

I like to look at how many shares insiders own in a company, to help inform my view of how aligned they are with insiders. I reckon it's a good sign if insiders own a significant number of shares in the company. Jamna Auto Industries insiders own about ₹4.3b worth of shares. That equates to 19% of the company. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

So What Do The Jamna Auto Industries Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Jamna Auto Industries shares in the last quarter. On a brighter note, the transactions over the last year are encouraging. With high insider ownership and encouraging transactions, it seems like Jamna Auto Industries insiders think the business has merit. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Jamna Auto Industries. Every company has risks, and we've spotted 3 warning signs for Jamna Auto Industries you should know about.

But note: Jamna Auto Industries 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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