POLYCAB - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 4.0

📊 POLYCAB shows strong fundamentals with excellent ROCE and ROE, supported by robust quarterly profit growth. The RSI at 39.4 indicates near-oversold conditions, while MACD is negative, suggesting short-term bearish sentiment. However, the stock is trading above DMA 50 and DMA 200, reflecting medium-term strength and offering a tactical swing trade opportunity.

💡 Optimal Entry Price: Around 7,300–7,400 ₹ (near DMA 50 support).

🚪 Exit Strategy: If already holding, consider exiting near 7,800–7,900 ₹ (close to 52-week high resistance) or trail stop-loss below 7,200 ₹.

✅ Positive

• 📈 Strong ROCE (29.7%) and ROE (21.4%) indicate efficient capital use.
• 💼 Large market cap of 1,11,975 Cr. provides stability.
• 📊 Quarterly PAT growth of 56.7% (675 Cr. vs 568 Cr.) highlights strong earnings momentum.
• 📈 FII holdings increased (+2.51%), showing foreign investor confidence.
• 🛡️ Very low debt-to-equity ratio (0.01), ensuring financial resilience.

⚠️ Limitation

• 📉 High P/E ratio (46.2) compared to industry PE (20.0), showing premium valuation.
• 🔻 PEG ratio of 1.42 suggests limited growth-adjusted value.
• 📊 Current RSI near oversold levels, indicating weak short-term momentum.
• 📉 Trading volume lower than weekly average, showing reduced participation.

🚨 Company Negative News

• 📉 MACD at -97.1 reflects short-term bearish sentiment.
• ⚠️ DII holdings increased only marginally (+0.09%), showing limited domestic institutional support.

🌟 Company Positive News

• 💼 Strong quarterly PAT growth supports earnings momentum.
• 📈 Stock trading above DMA 50 and DMA 200, showing medium-term technical strength.
• 💰 Dividend yield of 0.48% adds shareholder value.

🏭 Industry

• 📊 Industry PE at 20.0 vs POLYCAB’s 46.2, showing premium valuation.
• 🌐 Electricals and cables sector benefits from infrastructure growth and rising demand for power solutions.

📝 Conclusion

⚖️ POLYCAB is a strong swing trade candidate with robust fundamentals and medium-term technical strength. Entry near 7,300–7,400 ₹ offers a favorable setup, with exits planned around 7,800–7,900 ₹. Risk management is essential due to premium valuation and weak short-term momentum, but strong efficiency ratios and earnings growth support upside potential.

I can also compare POLYCAB’s swing trade setup with another electricals sector stock to highlight relative opportunities for short-term trading.