ALKEM - Swing Trade Analysis

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

Swing Trade Rating: 4.1

ALKEM Laboratories exhibits strong technical momentum and capital efficiency, making it a compelling swing trade candidate—especially if the current bullish cues are sustained in the near term.

✅ Strengths Supporting Swing Setup

Momentum Confirmed: RSI at 63.4 indicates bullish strength, nearing breakout territory without being overbought.

MACD Positive (37.9): Strong upward momentum, supporting trend continuation.

Price Action Favorable: Trading just above the 50-DMA (₹4,948) and near 200-DMA (₹5,076), forming a consolidation base above key supports.

Capital Efficiency: ROCE (20.4%) and ROE (19.4%) are solid, suggesting strong operating performance.

EPS (₹181) and P/E (28) below industry P/E (34.0) show attractive valuation relative to earnings.

Low Debt (0.12): Clean balance sheet supports sustainability.

DII Accumulation (+2.38%): Significant domestic buying interest.

⚠️ Weak Spots to Watch

Quarterly Profit Drop: From ₹626 Cr. to ₹306 Cr. is a notable dip, dampening sentiment.

High PEG Ratio (3.02): Indicates stretched valuation relative to growth.

FII Selling (-0.29%): Mild foreign outflows signal caution.

52W Index at 29.7%: Far off from its high of ₹6,440, suggesting supply zones overhead.

Volume Softening: Below 1-week average, a minor red flag for breakout sustainability.

📥 Optimal Entry Zone

Ideal range: ₹5,060–₹5,085

Confirm entry only if

RSI rises above 65

MACD continues widening positively

Price sustains above 200-DMA (₹5,076) with volume > 90K

🚪 Exit Strategy (If Already Holding)

Initial Target: ₹5,250–₹5,300 (first resistance cluster)

Mid-Term Target: ₹5,450–₹5,500 (historical support turned resistance)

Stretch Exit: ₹5,850–₹6,100 (only if high momentum breaks through)

Stop Loss: ₹4,925 (below 50-DMA and psychological level)

🧠 Final Take

ALKEM is riding strong technical indicators, cushioned by healthy fundamentals. It's not a deep discount swing, but it’s leaning bullish. A good setup for those who favor breakouts from consolidation with tight stop management.

Want to layer in candlestick patterns or check its historical bounce zones for confirmation? I can help chart that out. Let’s build the trade logic together.

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