CAMS - Swing Trade Analysis with AI Signals

Last Updated Time : 20 Dec 25, 07:01 am

Swing Trade Rating: 4.0

📊 CAMS shows moderate potential for swing trading. The stock is trading close to its 50 DMA (770 ₹) and 200 DMA (782 ₹), reflecting stability but slight weakness. RSI at 45.2 suggests neutral momentum, while MACD (-8.43) indicates mild bearish sentiment. Fundamentally, the company is strong with high ROCE (54.8%) and ROE (43.9%), supported by a healthy dividend yield (1.61%). Valuation is slightly stretched with a P/E of 42.6 compared to industry PE of 53.3, but overall, it remains a favorable candidate for short-term trades.

💡 Optimal Entry Price: Around 740–750 ₹ (near support zone).

🚪 Exit Strategy: If already holding, consider exiting near 780–800 ₹ (resistance at 200 DMA) or trail stop-loss below 730 ₹ to manage risk.

✅ Positive

• 📈 Strong ROCE (54.8%) and ROE (43.9%) highlight excellent capital efficiency.
• 💰 Dividend yield of 1.61% provides steady income support.
• 📊 DII holding increased (+3.45%), showing strong domestic institutional confidence.
• 📈 EPS of 17.8 ₹ supports earnings visibility.

⚠️ Limitation

• 📉 MACD (-8.43) signals short-term bearish momentum.
• 📊 PEG ratio (2.92) suggests growth is not aligned with valuation.
• 📉 Book value (45.6 ₹) is significantly lower than current price, indicating stretched valuation on assets.

🚨 Company Negative News

• 📉 Quarterly profit variation (-3.71%) shows slight earnings decline.
• 📉 FII holding reduced (-5.10%), reflecting foreign investor caution.

🌟 Company Positive News

• 📈 PAT improved from 105 Cr. to 111 Cr. in the latest quarter.
• 💡 Strong DII support (+3.45%) adds confidence in domestic sentiment.

🏭 Industry

• 📊 Industry PE at 53.3, higher than CAMS’s PE (42.6), suggesting relative undervaluation.
• 📈 Financial services sector demand remains strong, supported by mutual fund and asset management growth.

📌 Conclusion

CAMS is a moderately attractive swing trade candidate with strong fundamentals and fair valuation relative to peers. Entry near 740–750 ₹ offers a favorable risk-reward setup, while exits should be targeted around 780–800 ₹. Caution is advised due to short-term bearish indicators and reduced FII interest, but overall fundamentals and sector momentum provide support for short-term trades.

I can also prepare a comparison of CAMS with another financial services stock to highlight relative swing trade strength.