Don't Ignore The Insider Selling In Ind-Swift Laboratories

We note that the Ind-Swift Laboratories Limited (NSE:INDSWFTLAB) Chief Financial Officer, Gagan Aggarwal, recently sold ₹4.2m worth of stock for ₹141 per share. It might not be a huge sale, but it did reduce their holding size 18%, hardly encouraging.

Check out our latest analysis for Ind-Swift Laboratories

Ind-Swift Laboratories Insider Transactions Over The Last Year

Notably, that recent sale by Gagan Aggarwal is the biggest insider sale of Ind-Swift Laboratories shares that we've seen in the last year. That means that even when the share price was slightly below the current price of ₹144, an insider wanted to cash in some shares. 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. 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. We note that the biggest single sale was only 18% of Gagan Aggarwal's holding.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!

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Does Ind-Swift Laboratories Boast High Insider Ownership?

For a common shareholder, it is worth checking how many shares are held by company insiders. We usually like to see fairly high levels of insider ownership. Ind-Swift Laboratories insiders own about ₹896m worth of shares. That equates to 11% of the company. This level of insider ownership is good but just short of being particularly stand-out. It certainly does suggest a reasonable degree of alignment.

So What Do The Ind-Swift Laboratories Insider Transactions Indicate?

An insider sold stock recently, but they haven't been buying. And even if we look at the last year, we didn't see any purchases. But it is good to see that Ind-Swift Laboratories is growing earnings. The company boasts high insider ownership, but we're a little hesitant, given the history of share sales. So these insider transactions can help us build a thesis about the stock, but it's also worthwhile knowing the risks facing this company. To help with this, we've discovered 3 warning signs (1 is significant!) that you ought to be aware of before buying any shares in Ind-Swift Laboratories.

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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 of direct interests only, but not derivative transactions or indirect interests.

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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.