Trade Alert: The Non-Executive Chairman Of Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR), Khurshed Daruvala, Has Sold Some Shares Recently

By
Simply Wall St
Published
February 17, 2022
NSEI:SWSOLAR
Source: Shutterstock

Some Sterling and Wilson Renewable Energy Limited (NSE:SWSOLAR) shareholders may be a little concerned to see that the Non-Executive Chairman, Khurshed Daruvala, recently sold a substantial ₹1.6b worth of stock at a price of ₹375 per share. That sale reduced their total holding by 27% which is hardly insignificant, but far from the worst we've seen.

Check out our latest analysis for Sterling and Wilson Renewable Energy

The Last 12 Months Of Insider Transactions At Sterling and Wilson Renewable Energy

In fact, the recent sale by Non-Executive Chairman Khurshed Daruvala was not their only sale of Sterling and Wilson Renewable Energy shares this year. They previously made an even bigger sale of -₹2.0b worth of shares at a price of ₹251 per share. That means that even when the share price was below the current price of ₹360, 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. We note that the biggest single sale was only 22%of Khurshed Daruvala's holding.

Khurshed Daruvala ditched 12.29m shares over the year. The average price per share was ₹294. 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:SWSOLAR Insider Trading Volume February 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.

Insider Ownership of Sterling and Wilson Renewable Energy

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. I reckon it's a good sign if insiders own a significant number of shares in the company. Sterling and Wilson Renewable Energy insiders own about ₹11b worth of shares (which is 17% of the company). 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 Does This Data Suggest About Sterling and Wilson Renewable Energy Insiders?

An insider sold Sterling and Wilson Renewable Energy shares recently, but they didn't buy any. Looking to the last twelve months, our data doesn't show any insider buying. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Sterling and Wilson Renewable Energy. Be aware that Sterling and Wilson Renewable Energy is showing 5 warning signs in our investment analysis, and 2 of those are a bit concerning...

Of course Sterling and Wilson Renewable Energy may not be the best stock to buy. So you may wish to see this free collection of high quality 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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