TATACHEM - Swing Trade Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Swing Trade Rating: 4.2

📊 Analysis Summary

TATACHEM is showing strong short-term momentum with a sharp rebound in quarterly profits and high trading volume. Despite weak return ratios and a high P/E, the stock is technically bullish and well-positioned for a swing trade — especially if momentum sustains.

✅ Strengths

Quarterly Profit Turnaround: From -₹17.4 Cr to ₹252 Cr — signals recovery.

MACD (11.5) & RSI (67.2): Strong bullish momentum.

Volume Surge: Over 1 Cr vs 1-week avg of ~31L — confirms breakout interest.

Trading Above DMA 50 & 200: Bullish trend confirmation.

EPS Growth: ₹13.2 with 82.4% quarterly profit variation.

DII Buying (+0.65%): Domestic institutions showing confidence.

⚠️ Weaknesses

High P/E (55.3) vs Industry PE (27.2): Overvalued on earnings basis.

ROCE (3.96%) & ROE (1.20%): Weak capital efficiency.

PEG Ratio (-1.38): Negative growth expectations.

FII Selling (-0.44%): Mild foreign investor exit.

52w Index at 49.7%: Mid-range — not near breakout highs.

📈 Optimal Entry Price

Buy Zone: ₹980–₹995 Enter on slight pullback near DMA 200 (₹940) if RSI remains above 60 and volume sustains.

📉 Exit Strategy (If Already Holding)

Target Exit: ₹1,080–₹1,120 Resistance zone before previous high of ₹1,247.

Stop Loss: ₹950 Below DMA 200 — exit if momentum fades or RSI drops below 55.

🧠 Final Thoughts

TATACHEM is a momentum-driven swing trade with strong volume and technical indicators. While fundamentals are not compelling for long-term holding, the short-term setup favors a bullish move. Ideal for traders who can monitor RSI and volume closely.

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