Stock Analysis

Have Insiders Been Selling Ujjivan Financial Services Limited (NSE:UJJIVAN) Shares?

NSEI:UJJIVAN
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We've lost count of how many times insiders have accumulated shares in a company that goes on to improve markedly. On the other hand, we'd be remiss not to mention that insider sales have been known to precede tough periods for a business. So shareholders might well want to know whether insiders have been buying or selling shares in Ujjivan Financial Services Limited (NSE:UJJIVAN).

What Is Insider Selling?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock in the company. However, most countries require that the company discloses such transactions to the market.

Insider transactions are not the most important thing when it comes to long-term investing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Columbia University study found that 'insiders are more likely to engage in open market purchases of their own company’s stock when the firm is about to reveal new agreements with customers and suppliers'.

Check out our latest analysis for Ujjivan Financial Services

Ujjivan Financial Services Insider Transactions Over The Last Year

The Founder & Non-Executive Non-Independent Chairman, Samit Ghosh, made the biggest insider sale in the last 12 months. That single transaction was for ₹5.5m worth of shares at a price of ₹395 each. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The silver lining is that this sell-down took place above the latest price (₹270). So it may not shed much light on insider confidence at current levels.

Insiders in Ujjivan Financial Services didn't buy any shares in the last year. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NSEI:UJJIVAN Insider Trading Volume December 23rd 2020

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

Insider Ownership of Ujjivan Financial Services

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. Insiders own 1.4% of Ujjivan Financial Services shares, worth about ₹448m, according to our data. However, it's possible that insiders might have an indirect interest through a more complex structure. Overall, this level of ownership isn't that impressive, but it's certainly better than nothing!

What Might The Insider Transactions At Ujjivan Financial Services Tell Us?

It doesn't really mean much that no insider has traded Ujjivan Financial Services shares in the last quarter. While we feel good about high insider ownership of Ujjivan Financial Services, we can't say the same about the selling of shares. While we like knowing what's going on with the insider's ownership and transactions, we make sure to also consider what risks are facing a stock before making any investment decision. Every company has risks, and we've spotted 2 warning signs for Ujjivan Financial Services (of which 1 is significant!) you should know about.

Of course Ujjivan Financial Services 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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