POONAWALLA - Swing Trade Analysis with AI Signals
Back to ListSwing Trade Rating: 2.8
| Stock Code | POONAWALLA | Market Cap | 33,358 Cr. | Current Price | 411 ₹ | High / Low | 570 ₹ |
| Stock P/E | 95.5 | Book Value | 121 ₹ | Dividend Yield | 0.00 % | ROCE | 4.77 % |
| ROE | -1.29 % | Face Value | 2.00 ₹ | DMA 50 | 449 ₹ | DMA 200 | 442 ₹ |
| Chg in FII Hold | 0.05 % | Chg in DII Hold | -0.06 % | PAT Qtr | 150 Cr. | PAT Prev Qtr | 74.2 Cr. |
| RSI | 38.4 | MACD | -18.5 | Volume | 15,09,048 | Avg Vol 1Wk | 12,57,132 |
| Low price | 267 ₹ | High price | 570 ₹ | Debt to equity | 3.66 | 52w Index | 47.3 % |
| Qtr Profit Var | 702 % | EPS | 4.37 ₹ | Industry PE | 19.4 |
📊 Analysis: POONAWALLA shows weak fundamentals with ROCE at 4.77% and negative ROE (-1.29%). Debt-to-equity is high at 3.66, indicating leverage risk. The stock trades at a very expensive valuation (P/E 95.5 vs industry 19.4), which is not supported by earnings (EPS ₹4.37). Technically, the current price (₹411) is below both 50 DMA (₹449) and 200 DMA (₹442), showing bearish momentum. RSI at 38.4 suggests the stock is approaching oversold territory, while MACD (-18.5) confirms bearish divergence. Despite a sharp quarterly profit jump (702%), sustainability is questionable given weak efficiency metrics. This stock is a risky candidate for swing trading.
💡 Optimal Entry Price: Only consider entry near ₹380–₹390 if RSI dips further into oversold territory and reversal signals appear.
🚪 Exit Strategy: If already holding, exit near ₹440–₹450 (DMA resistance). Cut losses if price falls below ₹380 to protect capital.
✅ Positive
- Quarterly profit surged 702% (₹74.2 Cr → ₹150 Cr).
- Strong trading volume above weekly average, showing market activity.
- RSI near oversold zone may offer short-term bounce opportunity.
⚠️ Limitation
- High debt-to-equity ratio (3.66) increases financial risk.
- Negative ROE (-1.29%) reflects poor shareholder returns.
- Valuation extremely stretched (P/E 95.5 vs industry 19.4).
- Price trading below both 50 DMA and 200 DMA.
📉 Company Negative News
- Weak efficiency metrics (low ROCE, negative ROE).
- No dividend yield, limiting investor appeal.
- High leverage could pressure future earnings.
📈 Company Positive News
- Quarterly profit growth of 702% shows operational improvement.
- Strong trading volumes indicate investor interest.
🏭 Industry
- Industry P/E at 19.4 is far lower, highlighting POONAWALLA’s premium valuation.
- Financial services sector remains competitive with better peers available at lower valuations.
🔎 Conclusion
POONAWALLA is fundamentally weak with high debt, poor efficiency, and stretched valuations. While recent profit growth and oversold RSI may offer short-term bounce opportunities, risk remains elevated. Entry should be cautious near ₹380–₹390, with exit near ₹440–₹450. This stock is not an ideal swing trade candidate compared to stronger alternatives in the sector.