RITES - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 3.4

📊 Based on the given parameters, RITES shows moderate potential for swing trading. The company has strong fundamentals with high ROCE (20.0%) and ROE (15.1%), along with a healthy dividend yield (3.34%). However, technical indicators (RSI 33.8, MACD -5.61) suggest bearish momentum in the short term. The valuation (P/E 27.3 vs industry 18.8) is slightly expensive, but recent profit growth supports optimism. With zero debt, the balance sheet remains strong, making it a safer candidate for medium-term trades.

💡 Optimal Entry Price: Around 220–225 ₹ (near support zone and oversold RSI).

🚪 Exit Strategy: If already holding, consider exiting near 240–245 ₹ resistance or on breakdown below 220 ₹.

✅ Positive

• 📈 Strong quarterly PAT growth (102 Cr vs 66.6 Cr)
• 📊 High ROCE (20.0%) and ROE (15.1%)
• 💰 Attractive dividend yield (3.34%)
• 📉 Debt-free balance sheet (Debt-to-equity 0.00)

⚠️ Limitation

• 📉 RSI at 33.8, oversold but bearish
• 📊 MACD negative (-5.61), weak momentum
• 📉 P/E ratio (27.3) higher than industry average (18.8)
• 📊 PEG ratio negative (-3.23), poor growth-adjusted valuation

🚨 Company Negative News

• 📉 Slight decline in DII holdings (-0.02%)
• 📊 Stock trading below DMA 50 and DMA 200, trend weakness

🌟 Company Positive News

• 📈 Quarterly profit variation positive (18.9%)
• 📊 FII holdings increased slightly (+0.04%)

🏭 Industry

• 📊 Industry PE at 18.8, lower than RITES valuation
• 📈 Infrastructure and engineering sector benefiting from government projects and capital expenditure

📌 Conclusion

RITES is a moderately attractive swing trade candidate with strong fundamentals and dividend support, but short-term technical weakness limits immediate upside. Entry near 220–225 ₹ offers a favorable risk-reward setup, while exits should be targeted near 240–245 ₹. Traders should remain cautious due to bearish momentum and slightly expensive valuation.

I can also prepare a side-by-side swing trade comparison of RITES with another infrastructure PSU to highlight relative opportunities.