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Some Bajaj Auto Limited (NSE:BAJAJ-AUTO) shareholders may be a little concerned to see that the Non-Executive Director, Nirajkumar Bajaj, recently sold a whopping ₹156m worth of stock at a price of ₹2,952 per share. However, it's crucial to note that they remain very much invested in the stock and that sale only reduced their holding by 3.6%.
Check out our latest analysis for Bajaj Auto
Bajaj Auto Insider Transactions Over The Last Year
Notably, that recent sale by Non-Executive Director Nirajkumar Bajaj was not the only time they sold Bajaj Auto shares this year. Earlier in the year, they fetched ₹2,952 per share in a -₹156.5m sale. So it's clear an insider wanted to take some cash off the table, even slightly below the current price of ₹2,958. 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. However, while insider selling is sometimes discouraging, it's only a weak signal. It is worth noting that this sale was only 3.6% of Nirajkumar Bajaj's holding.
In the last twelve months insiders purchased 7400 shares for ₹21m. On the other hand they divested 59400 shares, for ₹175m. All up, insiders sold more shares in Bajaj Auto than they bought, over the last year. You can see the insider transactions (by individuals) over the last year depicted in the chart below. If you click on the chart, you can see all the individual transactions, including the share price, individual, and the date!
If you like to buy stocks that insiders are buying, rather than selling, then you might just love this free list of companies. (Hint: insiders have been buying them).
Insider Ownership of Bajaj Auto
Many investors like to check how much of a company is owned by insiders. We usually like to see fairly high levels of insider ownership. Bajaj Auto insiders own 4.7% of the company, currently worth about ₹40b based on the recent share price. 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 Bajaj Auto Tell Us?
The insider sales have outweighed the insider buying, at Bajaj Auto, in the last three months. And our longer term analysis of insider transactions didn't bring confidence, either. But it is good to see that Bajaj Auto is growing earnings. It is good to see high insider ownership, but the insider selling leaves us cautious. Therefore, you should should definitely take a look at this FREE report showing analyst forecasts for Bajaj Auto.