TATATECH - Technical Analysis with Chart Patterns & Indicators
Back to ListTechnical Rating: 3.8
| Stock Code | TATATECH | Market Cap | 27,232 Cr. | Current Price | 671 ₹ | High / Low | 797 ₹ |
| Stock P/E | 42.7 | Book Value | 43.5 ₹ | Dividend Yield | 1.24 % | ROCE | 45.1 % |
| ROE | 37.2 % | Face Value | 2.00 ₹ | DMA 50 | 604 ₹ | DMA 200 | 645 ₹ |
| Chg in FII Hold | 0.26 % | Chg in DII Hold | 0.52 % | PAT Qtr | 120 Cr. | PAT Prev Qtr | 135 Cr. |
| RSI | 69.8 | MACD | 23.7 | Volume | 10,07,797 | Avg Vol 1Wk | 21,10,249 |
| Low price | 507 ₹ | High price | 797 ₹ | PEG Ratio | 1.13 | Debt to equity | 0.04 |
| 52w Index | 56.5 % | Qtr Profit Var | -16.3 % | EPS | 14.0 ₹ | Industry PE | 26.8 |
📊 Chart Analysis: TATATECH is trading at ₹671, above both the 50 DMA (₹604) and 200 DMA (₹645), indicating strong bullish bias. RSI at 69.8 suggests the stock is approaching overbought territory. MACD at 23.7 is positive, confirming strong upward momentum. Bollinger Bands show price near the upper band, reflecting aggressive buying. Current volume (10.0L) is below the 1-week average (21.1L), showing reduced participation despite price strength.
📈 Momentum Signals: Short-term momentum is bullish, supported by MACD and price above moving averages. RSI indicates caution as the stock is nearing overbought levels.
💹 Support & Resistance: Strong support lies near ₹645 (200 DMA) and ₹604 (50 DMA). Immediate resistance is at ₹700, with major resistance at ₹797 (recent high). Optimal entry zone: ₹660–₹675. Exit zone: ₹690–₹710.
🔄 Trend Status: The stock is currently trending upward with strong momentum, though RSI suggests possible short-term consolidation.
Positive
- ✅ ROCE of 45.1% and ROE of 37.2% highlight excellent efficiency.
- ✅ EPS of ₹14.0 supports valuation strength.
- ✅ Dividend yield of 1.24% provides steady returns.
- ✅ Very low debt-to-equity ratio of 0.04 indicates financial stability.
- ✅ Both FII (+0.26%) and DII (+0.52%) holdings increased, reflecting investor confidence.
Limitation
- ⚠️ RSI at 69.8 indicates near-overbought conditions, raising risk of pullback.
- ⚠️ High P/E of 42.7 compared to industry P/E of 26.8, suggesting premium valuation.
- ⚠️ PEG ratio of 1.13 indicates valuation is not cheap relative to growth.
- ⚠️ Volume significantly below average, reflecting weak participation.
Company Negative News
- 📉 PAT declined sequentially from ₹135 Cr. to ₹120 Cr., showing earnings pressure.
- 📉 Quarterly profit variation of -16.3% highlights weak short-term performance.
Company Positive News
- 📈 Strong efficiency metrics (ROCE & ROE) highlight operational strength.
- 📈 Institutional investors (FII & DII) increased holdings, signaling confidence.
Industry
- 💻 Engineering & technology services sector trading at industry P/E of 26.8, lower than TATATECH’s P/E of 42.7, highlighting valuation concerns.
- 💻 Sector supported by demand for digital engineering, automotive design, and innovation services.
Conclusion
📌 TATATECH is trending upward, trading above key moving averages with strong MACD and RSI. Entry around ₹660–₹675 with exit near ₹690–₹710 offers a favorable short-term setup. Fundamentals show efficiency, low debt, and investor confidence, but high valuation multiples, declining profits, and overbought RSI are concerns. The stock may consolidate near resistance at ₹700–₹797 before resuming its trend.
For broader context, you could explore a engineering services outlook or compare TATATECH with peers through a valuation comparison.