Have Servotech Power Systems Insiders Been Selling Stock?

We wouldn't blame Servotech Power Systems Limited (NSE:SERVOTECH) shareholders if they were a little worried about the fact that Raman Bhatia, the MD & Executive Chairman recently netted about ₹105m selling shares at an average price of ₹131. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 2.6%.

Check out our latest analysis for Servotech Power Systems

The Last 12 Months Of Insider Transactions At Servotech Power Systems

In fact, the recent sale by Raman Bhatia was the biggest sale of Servotech Power Systems shares made by an insider individual in the last twelve months, according to our records. That means that an insider was selling shares at below the current price (₹134). We generally consider it a negative if insiders have been selling, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. Please do note, however, that sellers may have a variety of reasons for selling, so we don't know for sure what they think of the stock price. We note that the biggest single sale was only 2.6% of Raman Bhatia's holding.

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

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Insider Ownership Of Servotech Power Systems

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It's great to see that Servotech Power Systems insiders own 52% of the company, worth about ₹15b. Most shareholders would be happy to see this sort of insider ownership, since it suggests that management incentives are well aligned with other shareholders.

So What Do The Servotech Power Systems Insider Transactions Indicate?

The stark truth for Servotech Power Systems is that there has been more insider selling than insider buying in the last three months. Zooming out, the longer term picture doesn't give us much comfort. It is good to see high insider ownership, but the insider selling leaves us cautious. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Servotech Power Systems. Case in point: We've spotted 3 warning signs for Servotech Power Systems you should be aware of, and 1 of these shouldn'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 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.