Arihant Capital Markets' Insiders' Timely Sale May Have Helped Mitigate 11% Dip in Share Price

Insiders seem to have made the most of their holdings by selling ₹99m worth of Arihant Capital Markets Limited (NSE:ARIHANTCAP) stock at an average sell price of ₹69.83 during the past year. The company's market worth decreased by ₹1.2b over the past week after the stock price dropped 11%, although insiders were able to minimize their losses

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

See our latest analysis for Arihant Capital Markets

Arihant Capital Markets Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the Founder & Chairman, Ashok Jain, sold ₹72m worth of shares at a price of ₹69.98 per share. That means that an insider was selling shares at slightly below the current price (₹99.26). 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. It is worth noting that this sale was only 3.0% of Ashok Jain's holding.

Arihant Capital Markets insiders didn't buy any shares over the last year. The chart below shows insider transactions (by companies and individuals) over the last year. By clicking on the graph below, you can see the precise details of each insider transaction!

If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: Most of them are flying under the radar).

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 Arihant Capital Markets insiders own 75% of the company, worth about ₹7.8b. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Arihant Capital Markets Insiders?

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 Arihant Capital Markets insiders selling. In addition to knowing about insider transactions going on, it's beneficial to identify the risks facing Arihant Capital Markets. Every company has risks, and we've spotted 2 warning signs for Arihant Capital Markets (of which 1 is potentially serious!) you should know about.

Of course Arihant Capital Markets 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 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.