SPML Infra Ltd Faces Bearish Momentum Amid Technical Downturn

Technical Trend Shift and Price Action

SPML Infra’s technical trend has transitioned from mildly bearish to outright bearish, reflecting growing selling pressure. The stock closed at ₹182.40 on 21 Jan 2026, down 6.77% from the previous close of ₹195.65. Intraday, it traded between ₹180.00 and ₹195.00, failing to sustain gains near the day’s high. This decline comes despite the stock’s 52-week low of ₹137.00 and a high of ₹321.70, indicating a significant retracement from its peak.

The daily moving averages have turned bearish, signalling that short-term momentum is weakening. The stock’s inability to hold above key moving averages suggests that sellers are dominating near-term price action, increasing the likelihood of further downside.

MACD and Momentum Oscillators Confirm Bearish Bias

The Moving Average Convergence Divergence (MACD) indicator presents a mixed but predominantly bearish picture. On the weekly chart, the MACD remains bearish, with the MACD line below the signal line and both trending downward. The monthly MACD is mildly bearish, indicating that while longer-term momentum is weakening, it has not yet fully capitulated.

The Relative Strength Index (RSI) on both weekly and monthly timeframes currently shows no clear signal, hovering in neutral territory. This suggests that the stock is neither oversold nor overbought, leaving room for further directional movement based on other technical factors.

Bollinger Bands and KST Indicate Increased Volatility and Downside Pressure

Bollinger Bands on the weekly chart are bearish, with the price approaching the lower band, signalling increased volatility and potential continuation of the downtrend. The monthly Bollinger Bands are mildly bearish, reinforcing the view that the stock is under pressure but not yet in an extreme oversold condition.

The Know Sure Thing (KST) indicator, a momentum oscillator, aligns with this bearish outlook. It is bearish on the weekly timeframe and mildly bearish on the monthly, indicating that momentum is weakening across both intermediate and longer-term horizons.

On-Balance Volume and Dow Theory Signals

The On-Balance Volume (OBV) indicator shows a mildly bullish signal on the weekly chart, suggesting that volume flow is somewhat supportive despite price weakness. However, the monthly OBV shows no clear trend, indicating uncertainty in longer-term volume dynamics.

According to Dow Theory, the weekly trend is mildly bullish, which contrasts with the monthly mildly bearish stance. This divergence highlights a potential short-term relief or consolidation phase amid a longer-term downtrend, but the prevailing technical signals caution against optimism.

Mojo Score and Market Capitalisation Grade

SPML Infra’s Mojo Score currently stands at 34.0, categorised as a Sell rating, an upgrade from a previous Strong Sell grade as of 16 Jan 2026. This reflects a slight improvement in technical and fundamental outlook but remains firmly negative. The Market Cap Grade is a low 3, indicating limited market capitalisation strength relative to peers.

Comparative Returns Versus Sensex

Despite recent weakness, SPML Infra has outperformed the Sensex over shorter and longer periods. Over the past week, the stock returned 11.7% compared to the Sensex’s decline of 1.73%. Over one month, SPML Infra gained 4.86% while the Sensex fell 3.24%. Year-to-date, the stock is up 3.31% versus a 3.57% drop in the benchmark index.

However, over the last year, SPML Infra has underperformed significantly, with a negative return of 15.79% compared to the Sensex’s 6.63% gain. Over three and five years, the stock has delivered exceptional returns of 581.87% and 1103.17% respectively, far outpacing the Sensex’s 35.56% and 65.05% gains. The ten-year return of 174.29% trails the Sensex’s 241.54%, reflecting more recent challenges.

Sector Context and Outlook

Operating within the construction sector, SPML Infra faces headwinds from subdued infrastructure spending and rising input costs. The sector’s cyclical nature means that technical weakness in the stock may be exacerbated by broader economic factors. Investors should monitor government infrastructure initiatives and order book updates closely for signs of recovery.

Investment Implications and Conclusion

SPML Infra Ltd’s technical indicators collectively point to a bearish momentum shift, with key oscillators and moving averages signalling increased downside risk. While short-term volume indicators and Dow Theory weekly signals offer some mild bullish divergence, the dominant trend remains negative. The stock’s recent price action, combined with a Sell Mojo Grade, suggests caution for investors considering new positions.

Long-term investors may find value in the stock’s strong multi-year returns, but the current technical environment advises a wait-and-watch approach until clearer signs of trend reversal emerge. Monitoring the MACD and KST for improvements, alongside fundamental catalysts such as order inflows or sectoral recovery, will be critical for reassessing the stock’s outlook.

Given the mixed signals and sector challenges, investors might consider exploring alternative construction or infrastructure stocks with stronger technical profiles and higher Mojo Scores to optimise portfolio performance.

Unlock special upgrade rates for a limited period. Start Saving Now →