Don't Ignore The Fact That This Insider Just Sold Some Shares In Aarti Industries Limited (NSE:AARTIIND)

Some Aarti Industries Limited (NSE:AARTIIND) shareholders may be a little concerned to see that insider Jaya Gogri recently sold a substantial ₹805m worth of stock at a price of ₹894 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 8.3%.

Check out our latest analysis for Aarti Industries

Aarti Industries Insider Transactions Over The Last Year

In fact, the recent sale by Jaya Gogri was the biggest sale of Aarti Industries shares made by an insider individual in the last twelve months, according to our records. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹913. 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 just 8.3% of Jaya Gogri's stake.

Insiders in Aarti Industries didn't buy any shares in the last year. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Aarti Industries 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

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. 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's great to see that Aarti Industries insiders own 30% of the company, worth about ₹98b. This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Aarti Industries Tell Us?

Insiders sold Aarti Industries shares recently, but they didn't buy any. And even if we look at the last year, we didn't see any purchases. On the plus side, Aarti Industries makes money, and is growing profits. 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. 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 Aarti Industries you should know about.

If you would prefer to check out another company -- one with potentially superior financials -- then do not miss this free list of interesting companies, that have HIGH return on equity 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.

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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.
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