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It is not uncommon to see companies perform well in the years after insiders buy shares. Unfortunately, there are also plenty of examples of share prices declining precipitously after insiders have sold shares. So shareholders might well want to know whether insiders have been buying or selling shares in Mastek Limited (NSE:MASTEK).

What Is Insider Selling?

Most investors know that it is quite permissible for company leaders, such as directors of the board, to buy and sell stock on the market. However, rules govern insider transactions, and certain disclosures are required.

We don't think shareholders should simply follow insider transactions. But equally, we would consider it foolish to ignore insider transactions altogether. As Peter Lynch said, 'insiders might sell their shares for any number of reasons, but they buy them for only one: they think the price will rise.'

See our latest analysis for Mastek

The Last 12 Months Of Insider Transactions At Mastek

In the last twelve months, the biggest single sale by an insider was when the , Ketan Mehta, sold ₹58m worth of shares at a price of ₹466 per share. That means that an insider was selling shares at slightly below the current price (₹480). We generally consider it a negative if insiders have been selling on market, especially if they did so below the current price, because it implies that they considered a lower price to be reasonable. 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. This single sale was just 5.2% of Ketan Mehta's stake.

We note that in the last year insiders divested 140k shares for a total of ₹65m. Mastek insiders didn't buy any shares over the last year. You can see a visual depiction of insider transactions (by individuals) over the last 12 months, below. By clicking on the graph below, you can see the precise details of each insider transaction!

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Insiders at Mastek Have Sold Stock Recently

The last quarter saw substantial insider selling of Mastek shares. In total, Independent Non-Executive Director Atul Kanagat dumped ₹6.9m worth of shares in that time, and we didn't record any purchases whatsoever. Overall this makes us a bit cautious, but it's not the be all and end all.