Despite Salzer Electronics' Pullback, Insiders Still Gained ₹11m

Insiders who bought Salzer Electronics Limited (NSE:SALZERELEC) in the last 12 months may probably not pay attention to the stock's recent 14% drop. Reason being, despite the recent loss, insiders original purchase value of ₹14.1m is now worth ₹24.8m.

While insider transactions are not the most important thing when it comes to long-term investing, we do think it is perfectly logical to keep tabs on what insiders are doing.

Check out our latest analysis for Salzer Electronics

The Last 12 Months Of Insider Transactions At Salzer Electronics

Over the last year, we can see that the biggest insider purchase was by Non-Executive Non-Independent Director Vishnurangaswamy Doraiswamy for ₹13m worth of shares, at about ₹726 per share. Even though the purchase was made at a significantly lower price than the recent price (₹1,321), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

In the last twelve months insiders purchased 18.75k shares for ₹14m. But insiders sold 10.00k shares worth ₹785k. Overall, Salzer Electronics insiders were net buyers during the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Are Salzer Electronics Insiders Buying Or Selling?

We saw MD & Director Rangaswamynaidu Doraiswamy buy shares worth ₹974k in the last three months. But that was only a smidgen more than the ₹785k worth of sales. So it is hard to draw any conclusion about how insiders are feeling about the stock, from these recent trades.

Insider Ownership

For a common shareholder, it is worth checking how many shares are held by company insiders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Salzer Electronics insiders own 15% of the company, worth about ₹3.5b. We've certainly seen higher levels of insider ownership elsewhere, but these holdings are enough to suggest alignment between insiders and the other shareholders.

What Might The Insider Transactions At Salzer Electronics Tell Us?

It is good to see the recent insider purchase. And the longer term insider transactions also give us confidence. Once you factor in the high insider ownership, it certainly seems like insiders are positive about Salzer Electronics. That's what I like to see! 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. To that end, you should learn about the 3 warning signs we've spotted with Salzer Electronics (including 1 which is a bit unpleasant).

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 of direct interests only, but not derivative transactions or indirect interests.

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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.