Insiders Of Sigachi Industries Reap Rewards After Their Investment Jumps Another ₹489m

Last week, Sigachi Industries Limited (NSE:SIGACHI) insiders, who had purchased shares in the previous 12 months were rewarded handsomely. The shares increased by 10% last week, resulting in a ₹1.4b increase in the company's market worth, implying a 126% gain on their initial purchase. As a result, their original purchase of ₹388.9m worth of stock is now worth ₹878.4m.

While insider transactions are not the most important thing when it comes to long-term investing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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The Last 12 Months Of Insider Transactions At Sigachi Industries

In the last twelve months, the biggest single purchase by an insider was when CEO, MD & Director Amit Sinha bought ₹389m worth of shares at a price of ₹26.10 per share. Even though the purchase was made at a significantly lower price than the recent price (₹38.19), we still think insider buying is a positive. While it does suggest insiders consider the stock undervalued at lower prices, this transaction doesn't tell us much about what they think of current prices.

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

Check out our latest analysis for Sigachi Industries

There are plenty of other companies that have insiders buying up shares. You probably do not want to miss this free list of undervalued small cap companies that insiders are buying.

Insider Ownership Of Sigachi Industries

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. A high insider ownership often makes company leadership more mindful of shareholder interests. It appears that Sigachi Industries insiders own 36% of the company, worth about ₹5.2b. While this is a strong but not outstanding level of insider ownership, it's enough to indicate some alignment between management and smaller shareholders.

So What Do The Sigachi Industries Insider Transactions Indicate?

There haven't been any insider transactions in the last three months -- that doesn't mean much. However, our analysis of transactions over the last year is heartening. Judging from their transactions, and high insider ownership, Sigachi Industries insiders feel good about the company's future. 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. For instance, we've identified 3 warning signs for Sigachi Industries (1 can't be ignored) you should be aware of.

Of course Sigachi 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 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.