Don't Ignore The Fact That This Insider Just Sold Some Shares In The Karur Vysya Bank Limited (NSE:KARURVYSYA)

We note that a The Karur Vysya Bank Limited (NSE:KARURVYSYA) insider, A. Suriyanarayana, recently sold ₹2.3m worth of stock for ₹45.68 per share. However we note that the sale only shrunk their holding by 1.0%.

View our latest analysis for Karur Vysya Bank

The Last 12 Months Of Insider Transactions At Karur Vysya Bank

In fact, the recent sale by A. Suriyanarayana was the biggest sale of Karur Vysya Bank shares made by an insider individual in the last twelve months, according to our records. That means that even when the share price was below the current price of ₹47.85, an insider wanted to cash in some shares. As a general rule we consider it to be discouraging when insiders are selling below the current price, because it suggests they were happy with a lower valuation. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was just 1.0% of A. Suriyanarayana's stake.

Over the last year, we can see that insiders have bought 73.70k shares worth ₹3.4m. On the other hand they divested 85.75k shares, for ₹4.2m. In total, Karur Vysya Bank insiders sold more than they bought over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Insider Ownership of Karur Vysya Bank

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. It appears that Karur Vysya Bank insiders own 9.4% of the company, worth about ₹3.6b. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Does This Data Suggest About Karur Vysya Bank Insiders?

Unfortunately, there has been more insider selling of Karur Vysya Bank stock, than buying, in the last three months. Zooming out, the longer term picture doesn't give us much comfort. But it is good to see that Karur Vysya Bank is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. Be aware that Karur Vysya Bank is showing 2 warning signs in our investment analysis, and 1 of those can't be ignored...

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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. 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. Simply Wall St has no position in any stocks mentioned.