Insiders in Havells India Limited (NSE:HAVELLS) were left out from last week's 4.0% gains after selling stock earlier in the year

By
Simply Wall St
Published
March 17, 2022
NSEI:HAVELLS
Source: Shutterstock

While Havells India Limited (NSE:HAVELLS) shareholders have had a good week with the stock up 4.0%, they shouldn't let their guards down. The fact that insiders chose to dispose of ₹19m worth of stock in the past 12 months even though prices were relatively low could be indicative of some anticipated weakness.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

Check out our latest analysis for Havells India

Havells India Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the Executive President, Rajiv Goel, for ₹8.7m worth of shares, at about ₹1,164 per share. That means that an insider was selling shares at around the current price of ₹1,136. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. In this case, the big sale took place at around the current price, so it's not too bad (but it's still not a positive).

In the last year Havells India insiders didn't buy any company stock. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

insider-trading-volume
NSEI:HAVELLS Insider Trading Volume March 17th 2022

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Havells India Boast High Insider Ownership?

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. It's great to see that Havells India insiders own 6.0% of the company, worth about ₹43b. 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 Do The Havells India Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Havells India insiders selling. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. You'd be interested to know, that we found 1 warning sign for Havells India and we suggest you have a look.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting companies.

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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