GAIL - Technical Analysis with Chart Patterns & Indicators

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

Technical Rating: 3.5

📊 Chart Patterns & Trend: GAIL is trading below both its 50 DMA (176 ₹) and 200 DMA (181 ₹), showing short-term weakness. Support lies around 165–168 ₹, while resistance is seen near 175–180 ₹. The stock is in a bearish reversal phase with oversold signals emerging.

📈 Moving Averages: Current price (170 ₹) is below both 50 DMA and 200 DMA, indicating bearish sentiment in the short-to-medium term.

📉 RSI: At 34.5, RSI suggests oversold conditions, signaling potential accumulation zones.

📉 MACD: Negative (-3.27) reflects bearish momentum, though a crossover could indicate reversal if buying volume increases.

📊 Bollinger Bands: Price is near the lower band, implying limited downside and potential rebound if demand picks up.

📊 Volume Trends: Current volume (39.1 lakh) is below the 1-week average (55.0 lakh), showing reduced participation and weak momentum.

🎯 Entry Zone: 165–168 ₹ (near support and oversold RSI)

🎯 Exit Zone: 175–180 ₹ (near resistance and upper band)

Positive

• Strong ROCE (15.3%) and ROE (14.1%) highlight efficient capital usage.
• Dividend yield at 4.43% provides attractive income appeal.
• Quarterly PAT growth from 1,886 Cr. to 2,217 Cr. shows earnings strength.
• DII holdings increased by 0.95%, reflecting domestic institutional support.

Limitation

• P/E ratio (13.8) is slightly below industry average (15.4), offering limited valuation advantage.
• PEG ratio (-4.76) indicates poor alignment between growth and valuation.
• Debt-to-equity ratio at 0.26 is moderate compared to peers.
• Weak trading volume reduces short-term momentum signals.

Company Negative News

• FII holdings decreased by 1.19%, showing reduced foreign investor confidence.
• Quarterly profit variation at -17.0% indicates margin pressure despite higher PAT.

Company Positive News

• EPS at 15.2 ₹ reflects strong profitability.
• Dividend yield of 4.43% adds investor appeal.
• 52-week performance index at 37.0% shows resilience compared to broader market.

Industry

• Industry P/E at 15.4 indicates sector is moderately valued compared to GAIL’s P/E of 13.8.
• Energy and natural gas sector demand expected to remain stable with infrastructure and industrial growth.

Conclusion

⚖️ GAIL is in a bearish reversal phase with oversold RSI and weak momentum. Entry near 165–168 ₹ offers favorable risk-reward, while exits around 175–180 ₹ are optimal. Watch for MACD crossover and volume recovery to confirm a rebound from current weakness. Strong dividend yield and profitability provide stability despite technical weakness.