TATACHEM - Swing Trade Analysis with AI Signals

Last Updated Time : 19 Sept 25, 2:15 pm

Swing Trade Rating: 3.7

📊 Swing Trade Analysis for TATACHEM

TATACHEM presents a moderately favorable swing trading setup. While technical indicators and recent earnings improvement support a short-term trade, weak profitability and valuation concerns suggest a cautious approach.

✅ Strengths

Technical Momentum: RSI at 62.0 and MACD at 11.3 indicate bullish momentum with room to run.

Trend Confirmation: Price is above both 50 DMA (₹947) and 200 DMA (₹944), confirming a short-term uptrend.

Earnings Growth: PAT rose from ₹97 Cr. to ₹307 Cr., a strong sequential improvement.

Low Leverage: Debt-to-equity ratio of 0.12 adds financial stability.

DII Accumulation: DII holdings increased by 0.65%, signaling domestic institutional confidence.

EPS Strength: ₹23.3 EPS supports earnings quality.

⚠️ Weaknesses

Weak Profitability: ROCE at 3.67% and ROE at 2.81% are below ideal swing trade thresholds.

High Valuation: P/E of 43.8 vs industry average of 21.9 and negative PEG (-3.59) suggest overvaluation and poor growth alignment.

Volume Drop: Current volume is significantly below the 1-week average, indicating reduced trader interest.

FII Pullback: Decline of 0.44% in FII holdings may reflect foreign caution.

Moderate 52w Index (47.5%): Indicates underperformance relative to its yearly high.

🎯 Optimal Entry Price

Entry Zone: ₹960–₹970

A pullback near the 50 DMA offers a lower-risk entry with trend support and RSI cooling.

🚪 Exit Strategy (If Already Holding)

Target Exit: ₹1,030–₹1,050

A reasonable upside before testing resistance near ₹1,080.

Stop-Loss: ₹930

Below the 200 DMA to protect against reversal.

🧠 Final Thought

TATACHEM is a technically stable swing candidate with improving earnings and trend support. However, weak profitability and valuation concerns suggest a disciplined, short-term approach. Ideal for tactical traders who monitor momentum closely.

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