SAIL - Technical Analysis with Chart Patterns & Indicators

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

Technical Rating: 3.2

📈 Chart & Trend Analysis:

SAIL is trading at ₹126, below its 50 DMA (₹133) and slightly below its 200 DMA (₹129), indicating short-term weakness. RSI at 36.5 suggests the stock is approaching oversold territory, hinting at potential rebound opportunities. MACD at -1.84 is negative, confirming bearish undertone. Price is closer to its 52-week low (₹99.2) than its high (₹146). Bollinger Bands show price leaning toward the lower band, reflecting downside pressure. Current volume (1.31 Cr) is higher than the weekly average (1.11 Cr), suggesting active selling.

🔑 Momentum Signals:

- RSI near 36 indicates weak momentum, potential for rebound if support holds.

- MACD negative, confirming bearish continuation.

- Price below both DMAs signals short-term weakness.

- Elevated volume indicates strong participation in the downtrend.

🎯 Entry & Exit Zones:

- Support: ₹122 – ₹125 (near recent lows).

- Resistance: ₹132 – ₹134 (near 50 DMA).

- Optimal Entry: ₹122 – ₹126 range for rebound trades.

- Exit/Profit Booking: ₹132 – ₹134 unless breakout occurs.

📊 Trend Status:

The stock is reversing downward with bearish signals. Oversold RSI may trigger a short-term relief rally, but overall trend remains weak unless price sustains above 50 DMA.

Positive

• EPS at ₹5.85 provides earnings base.
• Dividend yield at 1.28% offers income return.
• Book value at ₹136 is higher than current price, indicating value support.
• DII holdings increased (+0.80%), showing domestic investor confidence.
• FII holdings increased slightly (+0.11%), reflecting foreign investor interest.

Limitation

• Price trading below both 50 DMA and 200 DMA.
• MACD negative, signaling bearish momentum.
• ROCE (6.73%) and ROE (4.38%) are modest compared to peers.
• PEG ratio at -0.47 indicates valuation concerns.

Company Negative News

• Quarterly PAT declined to ₹645 Cr from ₹685 Cr.
• Quarterly profit variation at -22.6% shows weak momentum.

Company Positive News

• DII holdings increased (+0.80%), reflecting domestic investor support.
• FII holdings increased (+0.11%), showing foreign investor confidence.
• Stock trading well above its 52-week low (₹99.2), showing resilience despite correction.

Industry

• Industry P/E at 20.9, SAIL trades at fair valuation (P/E 19.7).
• Steel sector is cyclical, with demand linked to infrastructure and global commodity trends.
• Peers trade at similar multiples, making SAIL reasonably valued but vulnerable to earnings volatility.

Conclusion

⚠️ SAIL is in a bearish reversal phase with oversold RSI suggesting possible short-term bounce. Entry near ₹122–₹126 may be considered for rebound trades, while resistance at ₹132–₹134 is critical. Fundamentals like book value support and dividend yield provide stability, but weak technicals and declining profits warrant cautious positioning.