Insiders selling on fast lane as Sensex, Nifty hit all-time high

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It seems that insiders are busy booking profit after a steep rise in the domestic equity market since March 2020. Data available with Edelweiss Alternative Research showed that promoters or key managerial personnel of select companies sold shares worth Rs 10,039 crore in July. On the other hand, their bought shares of Rs 2236 crore during the same period.

The selling by insiders come when the benchmark BSE Sensex surged around 110% since March 24 last year, while the broader indices BSE Midcap and Smallcap climbed 133% and 196%, respectively.

Meanwhile, the 30-share Sensex crossed the 56,000-mark on August 18 for the time. Market watchers believe that robust quarterly results coupled with robust liquidity and signs of improvement in the economy have aided the domestic equity market in the recent past.

Insiders further offloaded shares of Rs 7,013.74 crore in June against a purchase of Rs 3520.86 crore. Likewise, they sold shares of Rs 7013 crore in May against buying of Rs 204 crore. However, they offloaded shares of Rs 1,160 crore in April against the selling of Rs 724 crore.

Companies listed on bourses are required to disclose any buying and selling by promoters or key personnel on regular basis. The data collated by Edelweiss Alternative Research showed that key employees or promoters of leading banks, FMCG, chemical, pharma and real estate players recently sold some of their shares amid the ongoing rally on Dalal Street.

Commenting on the general market after the recent run-up, V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services said, “The present bull run primarily driven by the new retail investors is in an overbought, richly valued zone. It is important to remember that even sectors with good earnings visibility, like IT and metals, are highly valued. Therefore, even while remaining invested in this bull market, investors have to be cautious while committing fresh funds.”