ABB - Swing Trade Analysis with AI Signals

Last Updated Time : 20 Dec 25, 07:00 am

Swing Trade Rating: 3.4

📊 ABB shows strong fundamentals with excellent ROCE and ROE, very low debt, and consistent profitability. Technically, the stock is near its 50 DMA (5,172 ₹) but below the 200 DMA (5,509 ₹), suggesting mixed momentum. RSI at 45.1 indicates mild weakness, while MACD remains positive. Valuation is stretched with a P/E of 62 compared to industry average of 43.9, limiting upside potential. It can be considered for swing trading with cautious entry near support levels.

💡 Optimal Entry Price: Around 5,100–5,150 ₹ (near 50 DMA support).

🚪 Exit Strategy: If already holding, consider exiting near 5,600–5,700 ₹ resistance or if price falls below 5,000 ₹ support.

✅ Positive

• 📈 Strong ROCE (38.6%) and ROE (28.8%) highlight operational efficiency.
• 💵 Very low debt-to-equity ratio (0.01), showing financial strength.
• 📊 EPS of 83.2 ₹ supports earnings quality.
• 📈 PAT improved from 352 Cr. to 409 Cr., showing growth momentum.
• 📉 High trading volume (3,65,689 vs avg 1,96,208), indicating strong liquidity.

⚠️ Limitation

• 📉 High P/E (62) compared to industry average (43.9), suggesting overvaluation.
• 📉 RSI at 45.1 indicates weak momentum.
• 📉 Price below 200 DMA (5,509 ₹), showing medium-term weakness.
• 📉 Dividend yield of 0.87% is modest for income investors.

🚨 Company Negative News

• 📉 Quarterly profit variation (-7.17%) shows recent earnings slowdown.
• 📉 FII holdings decreased (-0.96%), reflecting reduced foreign investor confidence.

🌟 Company Positive News

• 📈 PAT growth quarter-on-quarter (352 Cr. → 409 Cr.) indicates resilience.
• 📊 DII holdings increased (+0.65%), showing domestic institutional support.
• 📈 Strong fundamentals with high ROCE and ROE continue to attract investors.

🏭 Industry

• 📊 Industry PE is 43.9, lower than ABB’s 62, suggesting ABB trades at a premium.
• 📈 Sector outlook remains positive with steady demand for industrial automation and electrification solutions.

📝 Conclusion

⚖️ ABB is fundamentally strong with excellent profitability and low debt, but valuations are stretched and technicals show mixed signals. For swing trading, entry near 5,100–5,150 ₹ with exit near 5,600–5,700 ₹ offers a reasonable setup. Risk management is essential given the high valuation and recent profit slowdown.

I can also prepare a comparison of ABB with peers like Siemens and Schneider Electric to highlight relative swing trade opportunities. Would you like me to do that?