TARIL - Investment Analysis: Buy Signal or Bull Trap?

Last Updated Time : 19 Sept 25, 2:16 pm

Investment Rating: 4.2

Here’s a detailed analysis of TARIL (likely Tata Advanced Systems or a similar Tata Group entity) as a long-term investment

📊 Fundamental Analysis

Valuation

P/E Ratio: 68.8 vs Industry PE of 49.4 — richly valued, but not unusual for high-growth plays.

PEG Ratio: 0.50 — excellent, indicating strong earnings growth relative to valuation.

Price to Book: ~12.9 — premium valuation, typical for high-growth, asset-light businesses.

Profitability

ROCE: 24.6% and ROE: 20.0% — very strong, signaling efficient capital deployment and shareholder value creation.

EPS: ₹7.64 — modest, but improving.

Quarterly PAT Growth: -18.9% sequentially, but YoY growth is robust at 227%.

Dividend Yield: 0.04% — negligible, not suitable for income investors.

Debt to Equity: 0.21 — low leverage, healthy balance sheet.

📈 Technical & Trend Indicators

DMA 50 / DMA 200: ₹506 / ₹477 — current price is above both, indicating bullish momentum.

RSI: 55.9 — neutral to slightly bullish.

MACD: 3.57 — positive crossover, supports upward trend.

Volume: Below average — suggests short-term cooling off.

52W Index: Trading at ~63% of its 52-week range — decent recovery from lows, but still far from peak.

💡 Ideal Entry Price Zone

Entry Zone: ₹480–₹510

This range aligns with DMA support and offers a better margin of safety.

Avoid entering above ₹550 unless earnings growth accelerates or valuation cools.

🧭 Exit Strategy / Holding Period

If you already hold TARIL

Holding Period: 3–5 years — ideal for compounding returns from high ROE/ROCE and PEG-driven growth.

Exit Strategy

Fundamental Trigger: Exit if ROE drops below 15% or PEG rises above 1.5 for 2+ quarters.

Technical Trigger: Consider trimming if price nears ₹640–₹660 without earnings support.

Re-entry: If price dips near ₹450 with improving profitability and volume support.

🧠 Final Verdict

TARIL is a high-growth long-term candidate with excellent profitability metrics and a compelling PEG ratio. While valuation is rich, its fundamentals justify a premium. Best suited for growth-oriented investors with a medium to long-term horizon.

Let me know if you’d like a peer comparison or sector outlook.

Edit in a page