ETERNAL - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 3.4

📈 Analysis: ETERNAL shows mixed signals for swing trading. While the fundamentals reflect strong quarterly profit growth and low debt, the technical indicators suggest weakness. The current price of ₹313 is below the 50 DMA (₹326), and RSI at 35.5 indicates oversold conditions. MACD is negative, hinting at continued bearish momentum. The high P/E of 128 and PEG ratio of 2.54 suggest overvaluation. However, rising DII interest and strong volume provide a potential setup for a rebound.

🎯 Optimal Entry Price: ₹305–₹310 (near support and oversold zone)

🚪 Exit Strategy (if holding): Consider exiting near ₹340–₹350 (next resistance zone) or if RSI crosses 60 with MACD confirmation.

✅ Positive

• 📊 Strong quarterly PAT growth (64.1%) — earnings momentum
• 📈 High trading volume — active market interest
• 📉 Low debt (Debt/Equity: 0.01) — financial stability
• 📈 DII holding increased (+3.55%) — domestic institutional confidence

⚠️ Limitation

• 📉 RSI at 35.5 and negative MACD — weak technical momentum
• 📉 Price below 50 DMA — short-term bearish trend
• 📉 High P/E (128) and PEG (2.54) — expensive valuation
• 📉 Low ROCE (7.34%) and ROE (6.55%) — inefficient capital use

📰 Company Negative News

• No major negative news reported, but valuation and technical weakness are concerns

🌟 Company Positive News

• Strong profit growth and rising DII interest signal potential recovery

🏭 Industry

• Industry P/E is 41.6 — ETERNAL trades at a significant premium
• Sector outlook remains cautiously optimistic, driven by domestic consumption and digital expansion

🧾 Conclusion

ETERNAL is a cautious swing trade candidate with strong earnings momentum but weak technicals and high valuation. Entry near support offers a low-risk setup if momentum improves. Exit near resistance or on RSI/MACD confirmation.

I can also compare ETERNAL’s valuation and technicals with peers in the same sector to refine your swing strategy.