Stock Analysis

How Much Are Britannia Industries Limited (NSE:BRITANNIA) Insiders Taking Off The Table?

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NSEI:BRITANNIA
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It is not uncommon to see companies perform well in the years after insiders buy shares. 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 Britannia Industries Limited (NSE:BRITANNIA).

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.

We would never suggest that investors should base their decisions solely on what the directors of a company have been doing. But it is perfectly logical to keep tabs on what insiders are doing. For example, a Harvard University study found that 'insider purchases earn abnormal returns of more than 6% per year'.

See our latest analysis for Britannia Industries

Britannia Industries Insider Transactions Over The Last Year

The MD & Whole Time Director, Varun Berry, made the biggest insider sale in the last 12 months. That single transaction was for ₹531m worth of shares at a price of ₹3,550 each. So we know that an insider sold shares at around the present share price of ₹3,501. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. Given that the sale took place at around current prices, it makes us a little cautious but is hardly a major concern. The only individual insider seller over the last year was Varun Berry.

Varun Berry divested 563.43k shares over the last 12 months at an average price of ₹3,558. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

insider-trading-volume
NSEI:BRITANNIA Insider Trading Volume January 31st 2021

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

Insiders at Britannia Industries Have Sold Stock Recently

Over the last three months, we've seen significant insider selling at Britannia Industries. In total, MD & Whole Time Director Varun Berry dumped ₹595m worth of shares in that time, and we didn't record any purchases whatsoever. This may suggest that some insiders think that the shares are not cheap.

Does Britannia Industries Boast High 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. We usually like to see fairly high levels of insider ownership. Based on our data, Britannia Industries insiders have about 0.009% of the stock, worth approximately ₹75m. We prefer to see high levels of insider ownership.

So What Do The Britannia Industries Insider Transactions Indicate?

An insider sold Britannia Industries shares recently, but they didn't buy any. And our longer term analysis of insider transactions didn't bring confidence, either. On the plus side, Britannia Industries makes money, and is growing profits. Insider ownership isn't particularly high, so this analysis makes us cautious about the company. We're in no rush to buy! 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. You'd be interested to know, that we found 3 warning signs for Britannia Industries and we suggest you have a look.

Of course Britannia Industries 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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