BERGEPAINT - Swing Trade Analysis with AI Signals

Last Updated Time : 05 Nov 25, 7:43 am

Swing Trade Rating: 3.7

📉 Berger Paints shows strong fundamentals but weak earnings and valuation pressure. Entry near ₹530 is optimal. If already held, consider exiting around ₹560–₹580.

📈 Positive

• 📊 ROCE of 24.9% and ROE of 20.0% reflect excellent capital efficiency.
• 💰 Dividend Yield of 0.71% and EPS of ₹8.69 offer modest returns.
• 📉 Debt-to-equity ratio of 0.08 shows a strong balance sheet.
• 📈 MACD at 1.68 and RSI at 48.9 suggest neutral-to-bullish momentum.
• 📈 Trading near DMA 50 and DMA 200 indicates potential support zone.

⚠️ Limitation

• 📉 Stock P/E of 60.2 vs industry average of 42.6 implies overvaluation.
• 📉 PEG ratio of 4.66 signals expensive growth expectations.
• 📉 Quarterly PAT dropped from ₹321 Cr. to ₹176 Cr. (↓45%).
• 📉 FII holding declined by 0.24%, showing reduced foreign confidence.

📉 Company Negative News

• 📉 Berger Paints reported a 23% drop in Q2 profit due to extended monsoon and weak demand

  CNBCTV18

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• 📉 Operating margin fell to 12.4% from 15.6% YoY, raising concerns about cost pressures

  CNBCTV18

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📈 Company Positive News

• 📈 Revenue grew 1.9% YoY despite seasonal headwinds, showing resilience

  CNBCTV18

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• 📈 Management expects demand recovery post-Diwali and margin improvement from lower raw material costs

  The Economic Times

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🎨 Industry

• 🎨 Paint industry benefits from urbanization, housing growth, and festive demand cycles.
• 📊 Industry P/E of 42.6 reflects premium valuation across leading players.

✅ Conclusion

• 📉 Berger Paints is a moderate swing trade candidate with strong fundamentals but earnings and valuation concerns.
• 📉 Optimal entry price: ₹530–₹535 (near support and below DMA 50).
• 📈 Exit target: ₹560–₹580 (near resistance and recent highs).
• 📌 Watch for RSI crossing 55 and volume pickup before entry.

Sources

[1] CNBC TV18

[2] Economic Times

[3] MarketsMojo

I can chart BERGEPAINT’s RSI and MACD trends to help visualize its technical setup—just let me know.