TCS - Swing Trade Analysis with AI Signals

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

Swing Trade Rating: 4.3

📊 Swing Trade Analysis for TCS

TCS presents a fundamentally strong and technically stable swing trading opportunity. While valuation is slightly stretched and long-term momentum is soft, short-term indicators and earnings strength support a tactical trade.

✅ Strengths

Exceptional Profitability: ROCE at 78.4% and ROE at 65.0% reflect world-class capital efficiency.

Earnings Growth: PAT rose from ₹11,116 Cr. to ₹12,552 Cr., showing consistent performance.

Trend Support: Price is above the 50 DMA (₹3,153), though slightly below the 200 DMA (₹3,480), suggesting a potential breakout setup.

Momentum Indicators: RSI at 59.6 and MACD at 10.1 indicate bullish momentum with room to run.

Volume Surge: Current volume exceeds the 1-week average, confirming active participation.

Valuation Comfort: P/E of 23.7 is below the industry average (30.0), offering relative value.

Dividend Yield: 1.89% provides income support during the swing period.

Low Leverage: Debt-to-equity ratio of 0.10 adds financial resilience.

⚠️ Weaknesses

PEG Ratio: At 2.97, suggests valuation may not be well-aligned with growth.

FII Pullback: Slight decline (-0.56%) in FII holdings may reflect foreign caution.

Low 52w Index (12.3%): Indicates significant underperformance relative to its yearly high.

Price Below 200 DMA: Suggests longer-term trend softness.

🎯 Optimal Entry Price

Entry Zone: ₹3,140–₹3,160

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

🚪 Exit Strategy (If Already Holding)

Target Exit: ₹3,300–₹3,350

A reasonable upside before testing resistance near ₹3,400.

Stop-Loss: ₹3,080

Below recent support and 50 DMA to protect against reversal.

🧠 Final Thought

TCS is a fundamentally elite swing candidate with strong earnings, trend support, and momentum. While valuation and long-term trend are modestly weak, disciplined entry and exit can yield a rewarding short-term trade. Ideal for traders seeking stability with upside potential.

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