TRIDENT - Investment Analysis: Buy Signal or Bull Trap?
Back to ListInvestment Rating: 2.8
| Stock Code | TRIDENT | Market Cap | 14,921 Cr. | Current Price | 29.3 ₹ | High / Low | 34.6 ₹ |
| Stock P/E | 33.8 | Book Value | 9.04 ₹ | Dividend Yield | 1.71 % | ROCE | 9.45 % |
| ROE | 8.18 % | Face Value | 1.00 ₹ | DMA 50 | 26.8 ₹ | DMA 200 | 28.6 ₹ |
| Chg in FII Hold | 0.11 % | Chg in DII Hold | 0.04 % | PAT Qtr | 92.4 Cr. | PAT Prev Qtr | 139 Cr. |
| RSI | 69.4 | MACD | 0.22 | Volume | 3,40,92,011 | Avg Vol 1Wk | 2,51,59,721 |
| Low price | 23.1 ₹ | High price | 34.6 ₹ | PEG Ratio | -1.43 | Debt to equity | 0.34 |
| 52w Index | 53.7 % | Qtr Profit Var | 10.7 % | EPS | 0.87 ₹ | Industry PE | 19.2 |
📊 Analysis: Trident shows weak fundamentals for long-term investment. ROE at 8.18% and ROCE at 9.45% are below ideal efficiency levels. EPS of 0.87 ₹ is very low, limiting earnings visibility. Dividend yield of 1.71% provides some income support, but not enough to offset weak profitability. The stock trades at a P/E of 33.8, significantly higher than the industry average of 19.2, indicating overvaluation. PEG ratio of -1.43 highlights poor growth relative to valuation. Debt-to-equity ratio of 0.34 is moderate but manageable. Technically, the stock is trading above both 50 DMA (26.8 ₹) and 200 DMA (28.6 ₹), showing short-term strength, with RSI at 69.4 suggesting overbought conditions. Quarterly PAT declined (92.4 Cr. vs 139 Cr.), raising concerns about earnings consistency.
💡 Entry Zone: Ideal accumulation only for speculative investors is between 24 ₹ – 27 ₹, closer to support levels. Conservative long-term investors should avoid fresh entry until profitability improves.
📈 Exit / Holding Strategy: Existing holders should consider partial profit booking near 32–34 ₹ resistance. Holding period should be short-to-medium term unless ROE/ROCE improve significantly. Long-term compounding prospects remain weak.
Positive
- Dividend yield of 1.71% provides some income support.
- Stock trading above both 50 DMA and 200 DMA indicates short-term strength.
- Quarterly profit variation (+10.7%) shows some resilience despite decline in absolute PAT.
- Minor increase in FII (+0.11%) and DII (+0.04%) holdings shows limited institutional interest.
Limitation
- Weak ROE (8.18%) and ROCE (9.45%) indicate poor efficiency.
- EPS of 0.87 ₹ is very low.
- High P/E (33.8) compared to industry average (19.2) suggests overvaluation.
- Negative PEG ratio (-1.43) highlights poor growth prospects.
- RSI at 69.4 indicates overbought conditions.
Company Negative News
- Decline in quarterly PAT (92.4 Cr. vs 139 Cr.).
- Weak profitability metrics compared to peers.
Company Positive News
- Dividend yield supports shareholder returns.
- Stock shows short-term technical strength above DMA levels.
Industry
- Industry P/E at 19.2 indicates moderate valuations compared to Trident’s premium.
- Textiles and home furnishing sector benefits from export demand and domestic consumption, but margins remain cyclical.