MGL - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 20 Dec 25, 03:55 pm

Technical Rating: 2.9

📉 Chart Patterns & Trend: MGL is trading at ₹1,149, below both its 50 DMA (₹1,209) and 200 DMA (₹1,306). This indicates a downtrend/reversal with weak momentum and lower highs. The stock is struggling to hold support levels.

📊 Moving Averages: Price below both short- and long-term averages confirms bearish sentiment. Key support lies near ₹1,092, while resistance is around ₹1,209–₹1,306.

📉 RSI: At 31.1, RSI is in the oversold zone, suggesting potential short-term bounce but overall weak momentum.

📉 MACD: Negative MACD (-33.2) signals bearish momentum, reinforcing the downtrend.

📉 Bollinger Bands: Price is near the lower band, indicating oversold conditions. A rebound toward mid-band (~₹1,180–₹1,200) is possible.

📊 Volume Trends: Current volume (1.09L) is significantly below the weekly average (3.99L), showing lack of strong buying interest. Weak volume confirms bearish sentiment.

🎯 Entry Zone: ₹1,100–₹1,130 (near support)

🚪 Exit Zone: ₹1,200–₹1,250 (near resistance)

Positive

• Strong ROCE (22.9%) and ROE (17.7%) reflect efficient capital utilization.
• Low debt-to-equity ratio (0.03) ensures financial stability.
• Dividend yield of 2.60% provides steady income for investors.
• PEG ratio of 0.64 suggests reasonable valuation relative to growth.

Limitation

• Stock trading below both 50 DMA and 200 DMA indicates bearish momentum.
• Quarterly PAT dropped from ₹320 Cr. to ₹193 Cr. (-32.6%).
• FII holding decreased (-1.89%), showing reduced foreign investor confidence.
• Weak trading volume reduces breakout potential.

Company Negative News

• Sharp decline in quarterly profits raises concerns about earnings stability.
• Reduced foreign institutional interest adds pressure on valuations.

Company Positive News

• DII holding increased (+0.37%), showing domestic institutional support.
• Strong fundamentals with low debt and consistent dividend payouts.

Industry

• Industry PE at 20.4 is higher than MGL’s PE (11.4), suggesting undervaluation compared to peers.
• Gas distribution sector benefits from rising urban demand and clean energy push.

Conclusion

📌 MGL is currently in a bearish reversal, trading below key moving averages with negative MACD and oversold RSI. Entry near ₹1,100–₹1,130 may offer short-term bounce potential, while resistance at ₹1,200–₹1,250 limits upside. Fundamentally undervalued compared to industry peers, but earnings volatility and weak momentum warrant caution in the near term.