Don't Ignore The Insider Selling In D-Link (India)

We'd be surprised if D-Link (India) Limited (NSE:DLINKINDIA) shareholders haven't noticed that the Non-Executive Director, Mukesh Lulla, recently sold ₹36m worth of stock at ₹709 per share. On the bright side, that sale was only 2.2% of their holding, so we doubt it's very meaningful, on its own.

View our latest analysis for D-Link (India)

D-Link (India) Insider Transactions Over The Last Year

Notably, that recent sale by Non-Executive Director Mukesh Lulla was not the only time they sold D-Link (India) shares this year. They previously made an even bigger sale of -₹57m worth of shares at a price of ₹436 per share. That means that an insider was selling shares at slightly below the current price (₹640). When an insider sells below the current price, it suggests that they considered that lower price to be fair. That makes us wonder what they think of the (higher) recent 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 5.1% of Mukesh Lulla's holding.

Mukesh Lulla sold a total of 341.95k shares over the year at an average price of ₹479. 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 D-Link (India) better if I see some big insider buys. While we wait, check out this free list of undervalued and small cap stocks with considerable, recent, insider buying.

Does D-Link (India) Boast High Insider Ownership?

Many investors like to check how much of a company is owned by 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 appears that D-Link (India) insiders own 13% of the company, worth about ₹3.0b. 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 Does This Data Suggest About D-Link (India) Insiders?

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 since D-Link (India) is profitable and growing, we're not too worried by this. 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. 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. Case in point: We've spotted 3 warning signs for D-Link (India) you should be aware of, and 1 of these shouldn't be ignored.

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 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.