Insiders Sold ₹350m Of Arihant Capital Markets Stock Possibly Sending Warning Sign

Even though Arihant Capital Markets Limited (NSE:ARIHANTCAP) stock gained 10% last week, insiders who sold ₹350m worth of stock over the past year are probably better off. Selling at an average price of ₹99.88, 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, logic dictates you should pay some attention to whether insiders are buying or selling shares.

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Arihant Capital Markets Insider Transactions Over The Last Year

In the last twelve months, the biggest single sale by an insider was when the insider, Kiran Jain, sold ₹350m worth of shares at a price of ₹99.88 per share. While we don't usually like to see insider selling, it's more concerning if the sales take place at a lower price. The good news is that this large sale was at well above current price of ₹89.81. So it is hard to draw any strong conclusion from it. Kiran Jain was the only individual insider to sell shares in the last twelve months.

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!

View our latest analysis for Arihant Capital Markets

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Insider Ownership Of Arihant Capital Markets

Looking at the total insider shareholdings in a company can help to inform your view of whether they are well aligned with common shareholders. Usually, the higher the insider ownership, the more likely it is that insiders will be incentivised to build the company for the long term. Arihant Capital Markets insiders own about ₹7.0b worth of shares (which is 71% of the company). This kind of significant ownership by insiders does generally increase the chance that the company is run in the interest of all shareholders.

What Might The Insider Transactions At Arihant Capital Markets Tell Us?

The fact that there have been no Arihant Capital Markets insider transactions recently certainly doesn't bother us. It's great to see high levels of insider ownership, but looking back over the last year, we don't gain confidence from the Arihant Capital Markets insiders selling. 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. While conducting our analysis, we found that Arihant Capital Markets has 1 warning sign and it would be unwise to ignore it.

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.