SONATSOFTW - Swing Trade Analysis with AI Signals
Back to ListSwing Trade Rating: 3.2
| Stock Code | SONATSOFTW | Market Cap | 6,513 Cr. | Current Price | 232 ₹ | High / Low | 464 ₹ |
| Stock P/E | 26.6 | Book Value | 28.6 ₹ | Dividend Yield | 1.90 % | ROCE | 30.6 % |
| ROE | 28.4 % | Face Value | 1.00 ₹ | DMA 50 | 285 ₹ | DMA 200 | 355 ₹ |
| Chg in FII Hold | -0.06 % | Chg in DII Hold | -0.03 % | PAT Qtr | 57.7 Cr. | PAT Prev Qtr | 147 Cr. |
| RSI | 27.6 | MACD | -17.5 | Volume | 3,44,191 | Avg Vol 1Wk | 6,20,621 |
| Low price | 229 ₹ | High price | 464 ₹ | PEG Ratio | -8.60 | Debt to equity | 0.16 |
| 52w Index | 1.11 % | Qtr Profit Var | 874 % | EPS | 7.86 ₹ | Industry PE | 20.8 |
📊 SONATSOFTW trades at ₹232, well below its 50DMA (₹285) and 200DMA (₹355), showing weak technical momentum. Indicators (RSI 27.6, MACD -17.5) suggest oversold conditions and bearish sentiment. Fundamentals are mixed: strong ROCE and ROE, low debt, and decent dividend yield, but profits have declined sharply and valuation looks stretched compared to industry PE. This makes SONATSOFTW a cautious swing trade candidate.
💡 Optimal Entry Price: Around ₹225–235 (near current support).
🔔 Exit Strategy if Holding: Consider exiting near ₹280–290 (around 50DMA resistance) unless momentum improves significantly.
✅ Positive
- ROCE at 30.6% and ROE at 28.4% show strong profitability.
- Debt-to-equity ratio of 0.16 indicates financial stability.
- Dividend yield of 1.90% provides investor support.
- EPS of ₹7.86 shows earnings consistency.
⚠️ Limitation
- High P/E of 26.6 compared to industry PE of 20.8.
- PEG ratio of -8.60 suggests poor growth valuation.
- Quarterly PAT fell sharply from ₹147 Cr. to ₹57.7 Cr.
- Trading volume lower than average, showing reduced activity.
📉 Company Negative News
- Sharp decline in quarterly profits.
- Price trading well below both 50DMA and 200DMA.
- FII holdings decreased by 0.06% and DII holdings by 0.03%, showing reduced institutional confidence.
📈 Company Positive News
- Strong ROCE and ROE compared to peers.
- Low debt enhances financial resilience.
- Dividend yield higher than many peers in the sector.
🏭 Industry
- Industry PE at 20.8, lower than SONATSOFTW’s valuation.
- IT services sector benefits from digital transformation and global outsourcing demand.
- Sector faces margin pressures due to rising costs and competitive pricing.
🔎 Conclusion
SONATSOFTW is financially stable with strong ROCE/ROE and a decent dividend yield but suffers from declining profits, weak technicals, and expensive valuation. It is a cautious swing trade candidate if entered near ₹225–235 with a target around ₹280–290. Risk management is essential due to weak momentum and profit decline.