DATAPATTNS - Investment Analysis: Buy Signal or Bull Trap?
Last Updated Time : 20 Dec 25, 07:05 am
Back to Investment ListInvestment Rating: 3.7
| Stock Code | DATAPATTNS | Market Cap | 14,304 Cr. | Current Price | 2,555 ₹ | High / Low | 3,269 ₹ |
| Stock P/E | 61.3 | Book Value | 275 ₹ | Dividend Yield | 0.31 % | ROCE | 21.0 % |
| ROE | 15.2 % | Face Value | 2.00 ₹ | DMA 50 | 2,755 ₹ | DMA 200 | 2,633 ₹ |
| Chg in FII Hold | -1.38 % | Chg in DII Hold | 1.71 % | PAT Qtr | 49.2 Cr. | PAT Prev Qtr | 25.5 Cr. |
| RSI | 34.1 | MACD | -93.0 | Volume | 3,38,224 | Avg Vol 1Wk | 2,51,414 |
| Low price | 1,350 ₹ | High price | 3,269 ₹ | PEG Ratio | 1.93 | Debt to equity | 0.00 |
| 52w Index | 62.8 % | Qtr Profit Var | 62.4 % | EPS | 41.7 ₹ | Industry PE | 57.9 |
📊 Analysis: DATAPATTNS shows solid fundamentals with ROE at 15.2% and ROCE at 21.0%, both supportive of long-term compounding. Debt-to-equity at 0.00 reflects a debt-free balance sheet. EPS at 41.7 ₹ and quarterly PAT growth (+62.4%) highlight strong profitability momentum. Valuation is slightly stretched with P/E at 61.3 compared to industry average of 57.9, but PEG ratio at 1.93 suggests growth-adjusted valuation is acceptable. Dividend yield at 0.31% is modest. Technicals show RSI at 34.1 (oversold), MACD negative (-93.0), and price below both 50 DMA (2,755 ₹) and 200 DMA (2,633 ₹), indicating bearish sentiment and potential correction.
💡 Entry Zone: Ideal entry would be in the 2,200–2,400 ₹ range, closer to valuation comfort and support levels. Current price (2,555 ₹) is slightly above fair entry zone, making patience advisable for better risk-reward.
📈 Exit Strategy: If already holding, maintain positions for medium-term (18–24 months) given strong ROE/ROCE and earnings growth. Consider partial profit booking near 2,900–3,000 ₹ resistance if valuations stretch further. Long-term holding is viable only if earnings growth sustains and valuation premium moderates.
Positive
- 📌 Strong ROE (15.2%) and ROCE (21.0%) support compounding potential
- 📌 Debt-free balance sheet ensures financial stability
- 📌 Quarterly PAT growth (+62.4%) highlights operational strength
- 📌 EPS at 41.7 ₹ reflects solid profitability
Limitation
- ⚠️ Valuation premium: P/E 61.3 vs industry 57.9
- ⚠️ Dividend yield at 0.31% is modest
- ⚠️ RSI at 34.1 shows oversold momentum
- ⚠️ MACD negative (-93.0) indicates bearish trend
Company Negative News
- ❌ FII holding decreased (-1.38%)
- ❌ Price trading below DMA levels signals weak sentiment
Company Positive News
- ✅ DII holding increased (+1.71%)
- ✅ PAT doubled from 25.5 Cr. to 49.2 Cr.
Industry
- 🏦 Industry PE at 57.9, sector moderately valued
- 🏦 Defense and aerospace sector benefiting from strong demand and government support
Conclusion
🔎 DATAPATTNS is moderately attractive for long-term investment with strong ROE/ROCE, debt-free balance sheet, and robust earnings growth. Entry near 2,200–2,400 ₹ offers margin of safety. Existing holders can maintain positions for 18–24 months, targeting exits near 2,900–3,000 ₹ unless valuations stretch further. Long-term compounding potential depends on sustained profitability and moderation of valuation premium.
Would you like me to extend this into a peer benchmarking overlay comparing DATAPATTNS against defense sector peers like HAL, BEL, and Mazagon Dock to highlight relative valuation comfort zones?
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