CERA - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 3.7

📊 CERA shows strong fundamentals with high ROCE (22.4%) and ROE (18.3%), supported by low debt levels. However, the stock is currently trading below both its 50 DMA (5,683 ₹) and 200 DMA (6,229 ₹), reflecting weak technical momentum. RSI at 39.4 suggests it is nearing oversold territory, while MACD (-131) indicates bearish sentiment. Despite short-term weakness, the company’s fundamentals make it a cautious swing trade candidate.

💡 Optimal Entry Price: Around 5,150–5,250 ₹ (close to support near 5,060 ₹).

🚪 Exit Strategy: If already holding, consider exiting near 5,650–5,700 ₹ (resistance at 50 DMA) or trail stop-loss below 5,050 ₹ to protect downside.

✅ Positive

• 📈 Strong ROCE (22.4%) and ROE (18.3%) highlight efficient capital use.
• 💰 Low debt-to-equity (0.04) ensures financial stability.
• 📊 EPS of 182 ₹ reflects solid earnings power.

⚠️ Limitation

• 📉 Trading below 50 DMA and 200 DMA shows weak technical strength.
• 📊 Quarterly profit variation (-16.8%) indicates earnings pressure.
• 📉 Moderate dividend yield (1.25%) offers limited income support.

🚨 Company Negative News

• 📉 FII holding reduced (-1.35%), showing foreign investor caution.
• 📉 Quarterly PAT declined from 46.5 Cr. to 56.6 Cr. but with negative variation (-16.8%).

🌟 Company Positive News

• 📈 DII holding increased (+1.49%), reflecting strong domestic institutional confidence.
• 💡 Stable dividend yield (1.25%) provides consistent shareholder returns.

🏭 Industry

• 📊 Industry PE at 28.9, nearly aligned with CERA’s PE (29.0), suggesting fair valuation.
• 📈 Sector demand supported by housing and infrastructure growth trends.

📌 Conclusion

CERA is a moderately attractive swing trade candidate with strong fundamentals but weak technicals. Entry near 5,150–5,250 ₹ offers a favorable risk-reward setup, while exits should be targeted around 5,650–5,700 ₹. Caution is advised due to declining profits and reduced FII interest, but domestic support and low debt provide stability for short-term trades.

Would you like me to also contrast CERA’s swing trade potential with another building materials stock to highlight relative sector strength?