TRIDENT - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 2.9

🧵 Fundamental Analysis of TRIDENT Ltd. (Textiles & Paper Manufacturer)

✅ Positives

Decent Dividend Yield: 1.61% — better than peers in textile sector

Low Debt: Debt-to-equity of 0.35 — financially stable

Quarterly Profit Growth: ₹140 Cr vs ₹133 Cr — 89.8% YoY jump

Price Stability: Trading near DMA 50 & DMA 200 — consolidation phase

Volume Surge: Recent volume spike may indicate accumulation

⚠️ Concerns

Weak Profitability Metrics

ROE: 8.28% and ROCE: 9.52% — below ideal for long-term compounding

EPS: ₹0.86 — low earnings base for valuation

Valuation Stretch

P/E: 36.1 vs Industry PE: 27.8 — trading at a premium despite weak ROE

Book Value: ₹9.07 vs Price: ₹31.0 — ~3.4x book, not justified by fundamentals

PEG Ratio: -1.52 — negative PEG suggests unreliable growth projections

Institutional Sentiment

FII Change: -0.04%, DII Change: +0.02% — neutral to slightly negative

Technical Neutrality

RSI: 48.4 — no clear trend

MACD: 0.05 — flat momentum

📉 Valuation & Ideal Entry Zone

Given current price and fundamentals

Ideal Entry Zone: ₹26–₹28

Closer to support zone and offers better margin of safety

Wait for RSI to dip below 40 or MACD to turn positive for confirmation

🧭 Long-Term Investment Outlook

TRIDENT is not a strong long-term candidate at current valuations. While it offers stability and modest dividends, its low ROE/ROCE and weak earnings base limit compounding potential.

Holding Period: 1–2 years (if already invested)

Monitor for improvement in ROE and EPS

Suitable only for tactical or dividend-focused investors

🚪 Exit Strategy (If Already Holding)

Partial Exit Zone: ₹35–₹38

Near resistance and valuation ceiling

Full Exit

If ROE remains below 10% for 2+ quarters

If PEG remains negative or EPS stagnates

If price breaks below ₹28 and fails to recover

Reinvest: Only if ROE improves to 12%+ and PEG turns positive

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