Stock Analysis

This Insider Has Just Sold Shares In Hi-Tech Pipes Limited (NSE:HITECH)

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We wouldn't blame Hi-Tech Pipes Limited (NSE:HITECH) shareholders if they were a little worried about the fact that Ajay Bansal, the Chairman & MD recently netted about ₹52m selling shares at an average price of ₹87.00. However, that sale only accounted for 1.2% of their holding, so arguably it doesn't say much about their conviction.

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Hi-Tech Pipes Insider Transactions Over The Last Year

Notably, that recent sale by Ajay Bansal is the biggest insider sale of Hi-Tech Pipes shares that we've seen in the last year. That means that even when the share price was below the current price of ₹90.15, an insider wanted to cash in some shares. 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. This single sale was just 1.2% of Ajay Bansal's stake.

You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

NSEI:HITECH Insider Trading Volume March 19th 2023

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).

Insider Ownership Of Hi-Tech Pipes

For a common shareholder, it is worth checking how many shares are held by company insiders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. From our data, it seems that Hi-Tech Pipes insiders own 5.3% of the company, worth about ₹606m. We do generally prefer see higher levels of insider ownership.

So What Do The Hi-Tech Pipes Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And there weren't any purchases to give us comfort, over the last year. 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. 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 4 warning signs for Hi-Tech Pipes (of which 1 is concerning!) you should know about.

Of course, you might find a fantastic investment by looking elsewhere. So take a peek at this free list of interesting 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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