POLYCAB - Technical Analysis with Chart Patterns & Indicators

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

Technical Rating: 3.9

📊 Technical Analysis

• Chart Patterns: Stock is trading near resistance (7,900 ₹) after a strong rally, showing strength but facing overhead supply.
• Moving Averages: Current price (7,438 ₹) is above both 50 DMA (7,380 ₹) and 200 DMA (6,916 ₹), indicating bullish bias.
• RSI: At 39.4, the stock is in weak territory, close to oversold levels despite price strength.
• MACD: Negative (-97.1), suggesting short-term bearish momentum despite long-term uptrend.
• Bollinger Bands: Price is near upper band, signaling strong momentum but risk of pullback.
• Volume Trends: Current volume (2,01,958) is lower than 1-week average (6,44,497), showing reduced participation near highs.

📈 Momentum & Signals

• Short-term Momentum: Mixed — price above DMA levels shows strength, but RSI and MACD suggest caution.
• Entry Zone: 7,200–7,350 ₹ (near 50 DMA support).
• Exit Zone: 7,800–7,900 ₹ (resistance near 52-week high).
• Trend Status: Currently consolidating near highs with bullish undertone.

✅ Positive

• Strong ROCE (29.7%) and ROE (21.4%).
• Debt-free structure (Debt-to-equity: 0.01).
• Quarterly PAT surged from 568 Cr. to 675 Cr. (+56.7%).
• FII holdings increased (+2.51%), showing foreign investor confidence.

⚠️ Limitation

• High P/E ratio (46.2) compared to industry PE (20.0), indicating premium valuation.
• RSI and MACD show weak short-term momentum.
• Volume participation is declining compared to average.

📉 Company Negative News

• Stock has corrected slightly from 52-week high of 7,903 ₹.
• Premium valuation compared to industry peers may limit upside.

📈 Company Positive News

• Quarterly profits improved strongly (+56.7%).
• FII holdings increased, showing foreign support.
• Stock trading above both 50 DMA and 200 DMA, confirming bullish trend.

🏭 Industry

• Industry PE is 20.0, much lower than POLYCAB’s PE of 46.2, highlighting premium valuation.
• Cable and electrical sector growth supported by infrastructure expansion and rising demand in housing and industry.

📝 Conclusion

• POLYCAB is technically consolidating near highs with bullish undertone but short-term caution signals.
• Best strategy: Accumulate near 7,200–7,350 ₹ and book profits around 7,800–7,900 ₹.
• Overall trend: Consolidation with bullish bias, awaiting stronger momentum confirmation.