CUMMINSIND - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 20 Dec 25, 03:54 pm

Technical Rating: 4.1

📊 Technical Analysis

• Chart Patterns: Price (4,407 ₹) is above both 50 DMA (4,318 ₹) and 200 DMA (3,801 ₹), showing strong bullish trend.
• Moving Averages: Positive alignment with price above short-term and long-term averages.
• RSI: 46.5 → neutral zone, not overbought or oversold, suggesting room for upside.
• MACD: 51.4 → bullish crossover, confirming upward momentum.
• Bollinger Bands: Price trading near upper band, showing strength but risk of short-term pullback.
• Volume Trends: Current volume (5.26 Lakh) is higher than 1-week average (3.52 Lakh), indicating strong participation and buying interest.

📈 Momentum & Signals

• Short-term Momentum: Bullish bias supported by MACD and volume strength.
• Support Zones: 4,300 ₹ (near-term), 4,150 ₹ (strong support), 3,800 ₹ (major support at 200 DMA).
• Resistance Zones: 4,500 ₹ (psychological), 4,615 ₹ (recent high).
• Optimal Entry: 4,300–4,350 ₹ range on minor dips.
• Optimal Exit: 4,550–4,600 ₹ range unless breakout above 4,615 ₹.
• Trend Status: Stock is trending upward with strong bullish signals.

✅ Positive

• Strong ROCE (37.6%) and ROE (28.8%) indicate excellent capital efficiency.
• Debt-free balance sheet (Debt-to-equity 0.00).
• Quarterly PAT growth (638 Cr. vs 555 Cr.) with 41.5% profit variation improvement.
• EPS of 81.6 ₹ supports valuation strength.

⚠️ Limitation

• High P/E (54.8) compared to industry PE (39.1), indicating premium valuation.
• RSI near neutral zone, limiting immediate upside momentum.
• DII holdings decreased (-0.80%), showing reduced domestic institutional confidence.

📉 Company Negative News

• Valuation stretched compared to industry peers.
• Minor decline in DII holdings.

📈 Company Positive News

• Strong quarterly PAT growth and margin expansion.
• FII holdings increased (+0.85%), showing foreign investor confidence.
• Dividend yield at 1.17% provides shareholder returns.

🏭 Industry

• Industry PE at 39.1, lower than company PE, suggesting Cummins trades at a premium.
• Industrial and engineering sector demand remains robust, supporting long-term growth.

🔎 Conclusion

• Stock is in a strong uptrend with bullish technical signals.
• Best entry near 4,300–4,350 ₹; exit near 4,550–4,600 ₹ unless breakout above 4,615 ₹.
• Long-term investors benefit from strong fundamentals, debt-free status, and consistent profit growth.