ELGIEQUIP - Technical Analysis with Chart Patterns & Indicators

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

Technical Rating: 3.0

📊 Technical Analysis

• Chart Patterns: Price (472 ₹) is below both 50 DMA (491 ₹) and 200 DMA (510 ₹), indicating weakness.
• Moving Averages: Bearish bias as price trades under short-term and long-term averages.
• RSI: 38.5 → weak momentum, close to oversold territory.
• MACD: -5.06 → bearish crossover, confirming downward bias.
• Bollinger Bands: Price near lower band, suggesting oversold conditions and potential rebound.
• Volume Trends: Current volume (2.17 Lakh) is below 1-week average (3.57 Lakh), showing reduced participation.

📈 Momentum & Signals

• Short-term Momentum: Bearish bias with oversold RSI suggesting possible short-term bounce.
• Support Zones: 460 ₹ (near-term), 440 ₹ (strong support), 390 ₹ (52-week low).
• Resistance Zones: 491 ₹ (50 DMA), 510 ₹ (200 DMA), 550 ₹ (psychological resistance).
• Optimal Entry: 460–440 ₹ range if RSI dips closer to 35.
• Optimal Exit: 491–510 ₹ range unless breakout above 550 ₹.
• Trend Status: Stock is trending downward with oversold signals; possible consolidation near support levels.

✅ Positive

• Strong ROCE (28.4%) and ROE (21.9%) indicate efficient capital use.
• DII holdings increased (+1.01%), showing domestic institutional confidence.
• EPS of 11.1 ₹ supports valuation strength.
• Debt-to-equity ratio of 0.01 indicates virtually debt-free balance sheet.

⚠️ Limitation

• Price trading below both 50 DMA and 200 DMA, showing weakness.
• Quarterly PAT variation (-7.24%) shows sequential earnings pressure.
• FII holdings decreased (-1.50%), showing reduced foreign investor confidence.
• High P/E (42.5) compared to industry PE (39.1), indicating premium valuation.

📉 Company Negative News

• PAT declined from 107 Cr. to 90.8 Cr., showing margin pressure.
• FII outflows indicate reduced foreign investor sentiment.
• Stock trading well below 52-week high (614 ₹), reflecting weak momentum.

📈 Company Positive News

• DII holdings increased, balancing FII outflows.
• Year-on-year profit variation (+17.6%) shows improvement despite sequential decline.
• Debt-free status supports financial stability.

🏭 Industry

• Industry PE at 39.1, slightly lower than company PE (42.5), suggesting Elgi Equip trades at a premium.
• Capital goods and engineering sector benefits from infrastructure and industrial growth but remains cyclical.

🔎 Conclusion

• Stock is in a downtrend with weak technical signals and oversold RSI suggesting possible short-term bounce.
• Best entry near 460–440 ₹; exit near 491–510 ₹ unless breakout above 550 ₹.
• Long-term investors should be cautious due to stretched valuations and FII outflows despite strong fundamentals and debt-free status.