How Much Are Sudarshan Chemical Industries Limited (NSE:SUDARSCHEM) Insiders Taking Off The Table?

We often see insiders buying up shares in companies that perform well over the long term. 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 Sudarshan Chemical Industries Limited (NSE:SUDARSCHEM).

What Is Insider Buying?

It is perfectly legal for company insiders, including board members, to buy and sell stock in a company. However, such insiders must disclose their trading activities, and not trade on inside information.

Insider transactions are not the most important thing when it comes to long-term investing. But logic dictates you should pay some attention to whether insiders are buying or selling shares. 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 Sudarshan Chemical Industries

The Last 12 Months Of Insider Transactions At Sudarshan Chemical Industries

The insider, Archana Rathi, made the biggest insider sale in the last 12 months. That single transaction was for ₹337m worth of shares at a price of ₹463 each. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹552. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. This single sale was 100% of Archana Rathi's stake. The only individual insider seller over the last year was Archana Rathi.

The chart below shows insider transactions (by companies and individuals) over the last year. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

For those who like to find winning investments this free list of growing companies with recent insider purchasing, could be just the ticket.

Does Sudarshan Chemical 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. Sudarshan Chemical Industries insiders own about ₹21b worth of shares (which is 55% 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.

So What Do The Sudarshan Chemical Industries Insider Transactions Indicate?

It doesn't really mean much that no insider has traded Sudarshan Chemical Industries shares in the last quarter. While we feel good about high insider ownership of Sudarshan Chemical Industries, 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. You'd be interested to know, that we found 3 warning signs for Sudarshan Chemical Industries and we suggest you have a look.

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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