TECHM - Technical Analysis with Chart Patterns & Indicators

Last Updated Time : 05 Nov 25, 7:43 am

Technical Rating: 3.4

📉 TECHM is currently in a consolidation phase with weak short-term momentum and bearish technical indicators. Tactical entry near ₹1,399–₹1,424 and exit near ₹1,467–₹1,476 may offer swing opportunities.

📊 Technical Overview

• Price Action: Trading at ₹1,426, below 50-DMA (₹1,472) and 200-DMA (₹1,520), indicating bearish bias.
• RSI (40.2): Weak momentum, approaching oversold territory but not yet signaling reversal.
• MACD (-8.50): Bearish crossover, confirming downward pressure.
• Bollinger Bands: Price near lower band, suggesting oversold conditions but no bounce yet.
• Volume: Above 1-week average, indicating active participation but not breakout strength.
• Support Zones: ₹1,399 (S3), ₹1,415 (S2), ₹1,424 (S1)
• Resistance Zones: ₹1,450 (R1), ₹1,467 (R2), ₹1,476 (R3)

✅ Positive

• Low debt-to-equity ratio (0.05) ensures financial stability.
• Dividend yield of 3.16% provides income cushion for investors.
• ROCE (18.2%) and ROE (14%) reflect decent capital efficiency.
• EPS of ₹40.1 supports valuation despite high P/E.

⚠️ Limitation

• Stock P/E (35.6) is significantly above industry average (29.4), indicating overvaluation.
• PEG ratio of -2.52 suggests poor earnings growth relative to valuation.
• Quarterly profit decline of -8.18% signals earnings pressure.
• MACD and RSI both show weak momentum, limiting upside potential.

📉 Company Negative News

• Decline in FII holdings (-2.68%) reflects reduced institutional confidence.
• Flat PAT quarter-on-quarter (₹1,176 Cr vs ₹1,178 Cr) shows stagnation.

📈 Company Positive News

• Increase in DII holdings (+2.51%) shows domestic investor support.
• Strong dividend payout and stable EPS reinforce shareholder value.

🏢 Industry

• IT Consulting & Software sector remains resilient but faces margin pressure due to global slowdown.
• Industry P/E of 29.4 suggests moderate valuation across peers.

🧭 Conclusion

• TECHM is consolidating with weak short-term momentum and bearish technical indicators.
• Optimal entry zone: ₹1,399–₹1,424; exit zone: ₹1,467–₹1,476.
• Hold for dividend and long-term upside if price stabilizes above ₹1,450.