TATACHEM - Swing Trade Analysis with AI Signals

Last Updated Time : 20 Dec 25, 07:02 am

Swing Trade Rating: 2.9

📊 TATACHEM currently shows weak potential for swing trading. The stock is priced at ₹763, trading below both its 50 DMA (₹827) and 200 DMA (₹899), indicating bearish technical momentum. RSI (25.1) suggests oversold conditions, while MACD (-25.9) confirms strong negative momentum. Fundamentals are mixed: while EPS (₹26.4) and dividend yield (1.47%) provide some support, ROCE (3.67%) and ROE (2.81%) are very low. The sharp quarterly profit decline (PAT down from ₹307 Cr. to ₹178 Cr.) further weakens sentiment.

✅ Optimal Entry Price: Around ₹745–755, near support levels.

🚪 Exit Strategy: If already holding, consider exiting near ₹820–850 (resistance zone) or on weakness below ₹740.

Positive

• 💡 Dividend yield of 1.47% provides steady income.
• 💡 EPS of ₹26.4 supports earnings base.
• 💡 Low debt-to-equity (0.11) ensures financial stability.
• 💡 FII holdings increased (+0.88%), showing foreign investor confidence.

Limitation

• ⚠️ Trading below DMA levels signals weak technical momentum.
• ⚠️ Low ROCE (3.67%) and ROE (2.81%) highlight poor capital efficiency.
• ⚠️ PEG ratio (-2.43) indicates unattractive growth-adjusted valuation.
• ⚠️ 52-week performance (+4.94%) shows limited upside compared to peers.

Company Negative News

• 📉 PAT declined sharply from ₹307 Cr. to ₹178 Cr.
• 📉 DII holdings decreased (-0.44%), showing weaker domestic institutional support.

Company Positive News

• 📈 FII holdings increased (+0.88%), reflecting foreign investor confidence.
• 📈 Dividend yield remains attractive for income-focused investors.

Industry

• 🏭 Industry P/E at 20.0 highlights TATACHEM’s premium valuation at 29.7.
• 🏭 Chemicals sector remains cyclical, influenced by global commodity demand and pricing.

Conclusion

🔎 TATACHEM is currently a weak candidate for swing trading due to poor technicals and declining profitability. Entry near ₹745–755 may offer limited risk, but upside is capped around ₹820–850. Best suited for cautious traders seeking short-term rebounds rather than aggressive momentum plays.

Would you like me to also highlight stop-loss and trailing exit levels to refine TATACHEM’s swing trade plan?