Insider Sales At Suratwwala Business Group Landed A Good Price

Despite the fact that Suratwwala Business Group Limited (NSE:SBGLP) stock rose 15% last week, insiders who sold ₹23m worth of stock in the previous 12 months are likely to be better off. Selling at an average price of ₹330, which is higher than the current price, may have been the best move for these insiders because their investment would have been worth less now than when they sold.

Although we don't think shareholders should simply follow insider transactions, we would consider it foolish to ignore insider transactions altogether.

View our latest analysis for Suratwwala Business Group

The Last 12 Months Of Insider Transactions At Suratwwala Business Group

Over the last year, we can see that the biggest insider sale was by the Chairman & MD, Jatin Suratwala, for ₹12m worth of shares, at about ₹331 per share. So it's clear an insider wanted to take some cash off the table, even below the current price of ₹823. 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 0.4% of Jatin Suratwala's stake. Jatin Suratwala was the only individual insider to sell shares in the last twelve months.

Jatin Suratwala sold a total of 70.00k shares over the year at an average price of ₹330. You can see a visual depiction of insider transactions (by companies and individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

I will like Suratwwala Business Group better if I see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Does Suratwwala Business Group 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. Suratwwala Business Group insiders own about ₹12b worth of shares (which is 81% 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 Does This Data Suggest About Suratwwala Business Group Insiders?

The fact that there have been no Suratwwala Business Group insider transactions recently certainly doesn't bother us. It's heartening that insiders own plenty of stock, but we'd like to see more insider buying, since the last year of Suratwwala Business Group insider transactions don't fill us with confidence. 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. You'd be interested to know, that we found 1 warning sign for Suratwwala Business Group and we suggest you have a look.

But note: Suratwwala Business Group may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE 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 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.