Sudarshan Chemical Industries Ltd Faces Bearish Momentum Amid Technical Downturn

Technical Momentum Shifts to Bearish

The stock of Sudarshan Chemical Industries Ltd, currently priced at ₹927.75, has seen its technical trend deteriorate from mildly bearish to outright bearish. This shift is underscored by a series of technical indicators that collectively point to weakening price momentum. The Moving Average Convergence Divergence (MACD) indicator presents a bearish stance on the weekly chart, while the monthly MACD remains mildly bearish, indicating sustained downward pressure over both short and medium terms.

Complementing this, the Relative Strength Index (RSI) on both weekly and monthly timeframes shows no clear signal, suggesting a lack of strong momentum either way but failing to provide any bullish confirmation. Meanwhile, Bollinger Bands on weekly and monthly charts also reflect a mildly bearish outlook, signalling that price volatility is skewed towards the downside.

Daily moving averages reinforce this bearish sentiment, with the stock trading below key averages, indicating that short-term price action is under pressure. The Know Sure Thing (KST) indicator aligns with this view, showing bearish momentum on the weekly scale and mildly bearish on the monthly scale.

Mixed Signals from Volume and Dow Theory

On the volume front, the On-Balance Volume (OBV) indicator offers a mildly bullish signal on the weekly chart, suggesting that despite price weakness, there is some accumulation by investors. However, the monthly OBV shows no clear trend, which tempers optimism. Dow Theory analysis reveals no definitive trend on the weekly timeframe, while the monthly perspective remains mildly bearish, reinforcing the overall cautious stance.

Today's trading session saw the stock dip by 1.30%, closing at ₹927.75 from a previous close of ₹939.95. The intraday range was wide, with a low of ₹849.05 and a high of ₹938.00, reflecting heightened volatility. The 52-week high stands at ₹1,604.00, while the 52-week low is ₹795.75, indicating that the current price is closer to the lower end of its annual range.

Performance Comparison with Sensex

When compared with the broader market, Sudarshan Chemical Industries Ltd has delivered mixed returns. Over the past week and month, the stock has outperformed the Sensex, posting gains of 1.47% against the Sensex’s declines of 1.14% and 1.20%, respectively. Year-to-date, however, the stock has declined by 2.09%, slightly underperforming the Sensex’s 3.04% fall.

Over longer horizons, Sudarshan Chemical has demonstrated robust growth, with a 3-year return of 147.50% compared to the Sensex’s 36.73%, a 5-year return of 82.00% against the Sensex’s 60.30%, and an impressive 10-year return of 1,065.52% dwarfing the Sensex’s 259.46%. These figures highlight the company’s strong fundamental positioning despite recent technical headwinds.

Mojo Score and Ratings Reflect Bearish Outlook

MarketsMOJO’s proprietary Mojo Score for Sudarshan Chemical Industries Ltd currently stands at 26.0, categorising the stock as a Strong Sell. This represents a downgrade from the previous Sell rating, effective from 14 February 2026. The Market Cap Grade is rated at 3, indicating a mid-tier market capitalisation relative to peers in the dyes and pigments sector.

The downgrade reflects the deteriorating technical parameters and the cautious outlook from a momentum perspective. Investors should note that the Strong Sell rating is driven by the convergence of bearish signals across multiple technical indicators, including MACD, moving averages, and KST, which collectively suggest further downside risk in the near term.

Sector and Industry Context

Sudarshan Chemical operates within the dyes and pigments industry, a sector that has faced cyclical pressures due to fluctuating raw material costs and demand variability. The sector’s performance has been mixed, with some companies showing resilience through innovation and cost control, while others grapple with margin compression.

Within this context, Sudarshan Chemical’s technical deterioration may reflect broader sectoral challenges, compounded by company-specific factors. The stock’s recent price action and technical signals should be analysed alongside fundamental developments and sector trends to form a comprehensive investment view.

Investor Takeaway and Outlook

For investors, the current technical landscape of Sudarshan Chemical Industries Ltd suggests prudence. The bearish momentum, confirmed by multiple indicators, signals potential for further price weakness in the short to medium term. The stock’s proximity to its 52-week low and the absence of strong bullish signals from RSI or Dow Theory reinforce this cautious stance.

However, the company’s impressive long-term returns relative to the Sensex highlight its underlying strength and potential for recovery once technical conditions improve. Investors with a longer horizon may consider monitoring the stock for signs of technical reversal, such as a bullish MACD crossover or sustained price movement above key moving averages.

In the meantime, portfolio managers and traders should weigh the current Strong Sell rating and technical signals against their risk tolerance and investment objectives, considering alternative opportunities within the sector or broader market.

Summary of Key Technical Indicators

• MACD: Weekly bearish, monthly mildly bearish
• RSI: No signal on weekly and monthly charts
• Bollinger Bands: Mildly bearish on weekly and monthly
• Moving Averages: Daily bearish
• KST: Weekly bearish, monthly mildly bearish
• Dow Theory: No trend weekly, mildly bearish monthly
• OBV: Mildly bullish weekly, no trend monthly

Price and Volume Snapshot (16 Feb 2026)

• Current Price: ₹927.75
• Previous Close: ₹939.95
• Day Change: -1.30%
• Day High: ₹938.00
• Day Low: ₹849.05
• 52-Week High: ₹1,604.00
• 52-Week Low: ₹795.75

Returns Comparison with Sensex

• 1 Week: +1.47% vs Sensex -1.14%
• 1 Month: +1.47% vs Sensex -1.20%
• Year-to-Date: -2.09% vs Sensex -3.04%
• 1 Year: -2.25% vs Sensex +8.52%
• 3 Years: +147.50% vs Sensex +36.73%
• 5 Years: +82.00% vs Sensex +60.30%
• 10 Years: +1,065.52% vs Sensex +259.46%

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