Tejas Networks Ltd Faces Intensified Downtrend Amid Mixed Technical Signals

Technical Momentum Shifts to Bearish

Recent technical analysis reveals that Tejas Networks has transitioned from a mildly bearish stance to a more pronounced bearish trend. The Moving Average Convergence Divergence (MACD) indicator, a key momentum oscillator, remains bearish on both weekly and monthly charts, indicating sustained downward pressure on the stock’s price momentum. This is compounded by the Bollinger Bands, which also signal bearishness on weekly and monthly timeframes, suggesting increased volatility with a downward bias.

Conversely, the Relative Strength Index (RSI) presents a more nuanced picture. While the weekly RSI is bullish, hinting at some short-term buying interest or oversold conditions, the monthly RSI also remains bullish but has not yet translated into a sustained upward price movement. This divergence between momentum indicators suggests that while there may be intermittent rallies, the overall trend remains under pressure.

Moving Averages and Other Indicators Confirm Downtrend

Daily moving averages for Tejas Networks are firmly bearish, with the stock price currently trading below key averages, reinforcing the downward trend. The Know Sure Thing (KST) indicator, which aggregates multiple momentum signals, is bearish on both weekly and monthly charts, further confirming the negative technical outlook.

Interestingly, Dow Theory analysis shows no clear trend on weekly or monthly scales, indicating a lack of definitive directional conviction from broader market forces. Similarly, On-Balance Volume (OBV) readings show no trend, suggesting that volume flows are not strongly supporting either buying or selling pressure at present.

Price Action and Volatility

Tejas Networks closed at ₹449.25, down 0.93% from the previous close of ₹453.45. The stock’s intraday range was between ₹448.60 and ₹464.00, reflecting moderate volatility. Notably, the 52-week high stands at ₹1,200.10, while the 52-week low is ₹440.05, indicating the stock is trading near its annual lows. This wide range underscores the significant correction the stock has undergone over the past year.

Comparative Performance Against Sensex

When benchmarked against the Sensex, Tejas Networks’ returns have been disappointing. Over the past week, the stock declined by 1.43%, while the Sensex gained 0.88%. The one-month return for Tejas Networks was a steep negative 9.1%, compared to a marginal Sensex decline of 0.32%. Year-to-date, the stock is nearly flat with a slight loss of 0.07%, whereas the Sensex has advanced 0.26%.

Longer-term performance is even more stark. Over the past year, Tejas Networks has plummeted 62.53%, while the Sensex rose 7.85%. Over three years, the stock is down 23.86%, contrasting with the Sensex’s robust 41.57% gain. However, over five years, the stock has delivered a remarkable 223.2% return, outperforming the Sensex’s 76.39% gain, highlighting its strong historical growth before the recent downturn.

Mojo Score and Ratings Reflect Bearish Sentiment

MarketsMOJO assigns Tejas Networks a Mojo Score of 1.0, categorising it as a Strong Sell. This represents a downgrade from the previous Sell rating on 20 Oct 2025, signalling deteriorating fundamentals and technical outlook. The Market Cap Grade stands at 3, indicating a mid-tier market capitalisation relative to peers in the telecom equipment sector.

The downgrade reflects the combination of weak price momentum, poor relative performance, and bearish technical indicators. Investors should note that the stock’s technical trend has shifted decisively into bearish territory, with multiple indicators aligning to suggest further downside risk.

Sector and Industry Context

Tejas Networks operates within the Telecom - Equipment & Accessories sector, which has faced headwinds due to global supply chain disruptions and competitive pressures. While some peers have managed to stabilise or recover, Tejas Networks’ technical and price action suggest it is lagging behind sector averages. The lack of clear volume support and absence of a confirmed trend in Dow Theory terms further complicate the outlook.

Investor Implications and Outlook

Given the current technical landscape, investors should exercise caution. The bearish MACD and moving averages indicate that the stock may continue to face selling pressure in the near term. Although the weekly and monthly RSI readings show some bullish undertones, these have yet to translate into a sustained reversal.

Traders might consider waiting for confirmation of a trend change, such as a bullish crossover in MACD or a break above key moving averages, before initiating new positions. Meanwhile, the stock’s proximity to its 52-week low suggests limited downside room, but also highlights the risk of further deterioration if support levels fail.

Conclusion

Tejas Networks Ltd currently faces a challenging technical and market environment. The convergence of bearish MACD, moving averages, and Bollinger Bands, alongside weak price performance relative to the Sensex, underscores the stock’s vulnerability. While some short-term bullish RSI signals offer a glimmer of hope, the overall technical trend remains negative.

Investors should monitor key technical levels and broader sector developments closely. Until a clear reversal pattern emerges, the stock’s Strong Sell rating and deteriorating momentum suggest a cautious approach is warranted.

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