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Insiders at Shaily Engineering Plastics Limited (NSE:SHAILY) must be relieved they sold stock as market valuation descends to ₹15b

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Insiders at Shaily Engineering Plastics Limited (NSE:SHAILY) sold ₹4.3m worth of stock at an average price of ₹1,832 a share over the past year, making the most of their investment. The company’s market worth decreased by ₹1.7b over the past week after the stock price dropped 10%, although insiders were able to minimize their losses

While insider transactions are not the most important thing when it comes to long-term investing, we would consider it foolish to ignore insider transactions altogether.

Our analysis indicates that SHAILY is potentially overvalued!

Shaily Engineering Plastics Insider Transactions Over The Last Year

Over the last year, we can see that the biggest insider sale was by the insider, Ramesh Shah, for ₹4.3m worth of shares, at about ₹1,832 per share. So we know that an insider sold shares at around the present share price of ₹1,672. We generally don’t like to see insider selling, but the lower the sale price, the more it concerns us. In this case, the big sale took place at around the current price, so it’s not too bad (but it’s still not a positive). Ramesh Shah was the only individual insider to sell over the last year.

You can see the insider transactions (by companies and individuals) over the last year depicted in the chart below. By clicking on the graph below, you can see the precise details of each insider transaction!

insider-trading-volume
NSEI:SHAILY Insider Trading Volume November 11th 2022

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

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. Shaily Engineering Plastics insiders own 57% of the company, currently worth about ₹8.8b 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.

So What Do The Shaily Engineering Plastics Insider Transactions Indicate?

There haven’t been any insider transactions in the last three months — that doesn’t mean much. It’s heartening that insiders own plenty of stock, but we’d like to see more insider buying, since the last year of Shaily Engineering Plastics insider transactions don’t fill us with confidence. I like to dive deeper into how a company has performed in the past. You can access this interactive graph of past earnings, revenue and cash flow for free.

But note: Shaily Engineering Plastics may not be the best stock to buy. So take a peek at this free list of interesting companies with high ROE and low debt.

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, but not derivative transactions.

Valuation is complex, but we’re helping make it simple.

Find out whether Shaily Engineering Plastics is potentially over or undervalued by checking out our comprehensive analysis, which includes fair value estimates, risks and warnings, dividends, insider transactions and financial health.

View the Free Analysis

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.

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