Have Manappuram Finance Insiders Been Selling Stock?

Anyone interested in Manappuram Finance Limited (NSE:MANAPPURAM) should probably be aware that a company insider, Blangat Raveendra Babu, recently divested ₹21m worth of shares in the company, at an average price of ₹205 each. The eyebrow raising move amounted to a reduction of 11% in their holding.

View our latest analysis for Manappuram Finance

The Last 12 Months Of Insider Transactions At Manappuram Finance

Over the last year, we can see that the biggest insider purchase was by MD, CEO & Non-Independent Executive Director Vazhappully Nandakumar for ₹35m worth of shares, at about ₹174 per share. Even though the purchase was made at a significantly lower price than the recent price (₹214), we still think insider buying is a positive. Because it occurred at a lower valuation, it doesn't tell us much about whether insiders might find today's price attractive.

Over the last year we saw more insider selling of Manappuram Finance shares, than buying. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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).

Does Manappuram Finance 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. We usually like to see fairly high levels of insider ownership. Manappuram Finance insiders own about ₹64b worth of shares (which is 36% 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.

What Might The Insider Transactions At Manappuram Finance Tell Us?

Insiders sold stock recently, but they haven't been buying. And our longer term analysis of insider transactions didn't bring confidence, either. But since Manappuram Finance is profitable and growing, we're not too worried by this. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. 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. Every company has risks, and we've spotted 3 warning signs for Manappuram Finance (of which 1 can't be ignored!) you should know about.

Of course Manappuram Finance 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.