KIRLOSBROS - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 3.3

📊 Kirloskar Brothers (KIRLOSBROS) shows moderate potential for swing trading. The stock is currently trading below both its 50 DMA (1,748 ₹) and 200 DMA (1,850 ₹), reflecting short-term weakness. RSI at 41.2 suggests the stock is approaching oversold territory, while MACD remains negative (-41.5), confirming bearish momentum. Fundamentally, the company has strong ROCE (20.8%) and ROE (15.8%), very low debt-to-equity (0.02), but faces valuation risk with a high P/E (55.2 vs industry 39.1) and declining quarterly profits (-40.3%).

💡 Optimal Entry Price: Around 1,500–1,550 ₹ (near support zone, above 52-week low of 1,422 ₹).

🚪 Exit Strategy: If already holding, consider exiting near 1,750–1,800 ₹ (resistance around 50 DMA) or if RSI crosses 60 with weakening momentum.

✅ Positive

• 📈 Strong ROCE (20.8%) and ROE (15.8%) indicate efficient capital use
• 💰 Very low debt-to-equity ratio (0.02) ensures financial stability
• 📊 EPS of 30.6 ₹ supports earnings base
• 📦 Dividend yield of 0.45% provides modest income

⚠️ Limitation

• 📉 High P/E ratio (55.2) compared to industry average (39.1)
• 📊 Stock trading below both 50 DMA and 200 DMA shows technical weakness
• 📉 RSI near oversold but MACD sharply negative, limiting rebound potential
• 📊 Weak trading volume compared to average (44,150 vs 1,39,486)

🚨 Company Negative News

• 📉 Quarterly PAT declined from 47.0 Cr. to 37.6 Cr. (-40.3% variation)
• 📊 Slight decline in FII holdings (-0.26%)

🌟 Company Positive News

• 📈 DII holdings increased slightly (+0.11%)
• 💡 Strong capital efficiency with ROCE and ROE above industry averages

🏭 Industry

• 📊 Industry P/E at 39.1, Kirloskar trades at a premium valuation
• 🏗️ Engineering and industrial sector demand remains resilient, supporting long-term outlook

📌 Conclusion

⚖️ Kirloskar Brothers is a cautious candidate for swing trading. Fundamentals show strong efficiency and low debt, but technical indicators remain weak and profits have declined. A careful entry near 1,500–1,550 ₹ could provide upside potential toward 1,750–1,800 ₹. Traders should monitor RSI and MACD closely to confirm momentum reversal before committing to positions.

I can also highlight short-term breakout levels to help you track potential upside beyond the 1,800 ₹ resistance.