The Executive Vice President of Corporate Affairs of Lemon Tree Hotels Limited (NSE:LEMONTREE), Davander Tomar, Just Sold 100% Of Their Holding

We'd be surprised if Lemon Tree Hotels Limited (NSE:LEMONTREE) shareholders haven't noticed that the Executive Vice President of Corporate Affairs, Davander Tomar, recently sold ₹18m worth of stock at ₹42.97 per share. In particular, we note that the sale equated to a 100% reduction in their position size, which doesn't exactly instill confidence.

See our latest analysis for Lemon Tree Hotels

Lemon Tree Hotels Insider Transactions Over The Last Year

Notably, that recent sale by Davander Tomar is the biggest insider sale of Lemon Tree Hotels shares that we've seen in the last year. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹44.40. 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. While insider selling is not a positive sign, we can't be sure if it does mean insiders think the shares are fully valued, so it's only a weak sign. This single sale was 100% of Davander Tomar's stake.

In total, Lemon Tree Hotels insiders sold more than they bought over 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!

I will like Lemon Tree Hotels better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Lemon Tree Hotels Boast High Insider Ownership?

Another way to test the alignment between the leaders of a company and other shareholders is to look at how many shares they own. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. It appears that Lemon Tree Hotels insiders own 4.8% of the company, worth about ₹1.7b. 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 Do The Lemon Tree Hotels Insider Transactions Indicate?

An insider hasn't bought Lemon Tree Hotels stock in the last three months, but there was some selling. Zooming out, the longer term picture doesn't give us much comfort. While insiders do own a lot of shares in the company (which is good), our analysis of their transactions doesn't make us feel confident about the company. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Lemon Tree Hotels. You'd be interested to know, that we found 3 warning signs for Lemon Tree Hotels and we suggest you have a look.

But note: Lemon Tree Hotels may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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.

If you’re looking to trade Lemon Tree Hotels, open an account with the lowest-cost* platform trusted by professionals, Interactive Brokers. Their clients from over 200 countries and territories trade stocks, options, futures, forex, bonds and funds worldwide from a single integrated account. Promoted

This article by Simply Wall St is general in nature. 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.
^*Interactive Brokers Rated Lowest Cost Broker by StockBrokers.com Annual Online Review 2020

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com.