Shubhlaxmi Jewel Art's Stock Sinks To ₹29.15, But Insiders Sold Even Lower

Even though Shubhlaxmi Jewel Art Limited (NSE:SHUBHLAXMI) has fallen by 10% over the past week , insiders who sold ₹18m worth of stock over the past year have had less luck. Insiders might have been better off holding onto their shares, given that the average selling price of ₹42.37 is still below the current share price.

While we would never suggest that investors should base their decisions solely on what the directors of a company have been doing, logic dictates you should pay some attention to whether insiders are buying or selling shares.

View our latest analysis for Shubhlaxmi Jewel Art

Shubhlaxmi Jewel Art Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Soham Chauhan, sold ₹4.6m worth of shares at a price of ₹42.46 per share. While insider selling is a negative, to us, it is more negative if the shares are sold at a lower price. It's of some comfort that this sale was conducted at a price well above the current share price, which is ₹29.15. So it is hard to draw any strong conclusion from it. The only individual insider seller over the last year was Soham Chauhan.

Soham Chauhan divested 417.00k shares over the last 12 months at an average price of ₹42.37. You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. If you want to know exactly who sold, for how much, and when, simply click on the graph below!

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Shubhlaxmi Jewel Art Insiders Are Selling The Stock

Over the last three months, we've seen significant insider selling at Shubhlaxmi Jewel Art. Specifically, insider Soham Chauhan ditched ₹18m worth of shares in that time, and we didn't record any purchases whatsoever. In light of this it's hard to argue that all the insiders think that the shares are a bargain.

Does Shubhlaxmi Jewel Art Boast High Insider Ownership?

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. It's great to see that Shubhlaxmi Jewel Art insiders own 60% of the company, worth about ₹163m. I like to see this level of insider ownership, because it increases the chances that management are thinking about the best interests of shareholders.

So What Does This Data Suggest About Shubhlaxmi Jewel Art Insiders?

An insider hasn't bought Shubhlaxmi Jewel Art stock in the last three months, but there was some selling. And there weren't any purchases to give us comfort, over the last year. But it is good to see that Shubhlaxmi Jewel Art is growing earnings. 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 it's good to be aware of 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. To help with this, we've discovered 6 warning signs (4 don't sit too well with us!) that you ought to be aware of before buying any shares in Shubhlaxmi Jewel Art.

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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.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com