Tera Software Ltd Hits Lower Circuit Amid Heavy Selling Pressure

Intraday Price Movement and Circuit Breaker Trigger

On 12 Feb 2026, Tera Software Ltd’s stock opened with a significant gap down of 3.15%, setting a bearish tone from the outset. The share price touched an intraday low of ₹398.3, representing a 5.0% drop from the previous close, before settling at ₹402.5. This decline triggered the lower circuit price band of ₹16.75, equivalent to a 4.0% fall, the maximum permissible daily loss under current exchange regulations.

The stock’s price band is set at 5%, and the weighted average price for the day was closer to the low end of the range, indicating that the bulk of trading volume occurred near the bottom of the day’s price spectrum. This pattern is a classic sign of sustained selling pressure and a lack of buying interest at higher levels.

Volume and Liquidity Analysis

Trading volumes were relatively modest, with total traded volume at 0.21807 lakh shares and turnover amounting to ₹0.885 crore. Despite the micro-cap status and limited liquidity, the stock remains sufficiently liquid for small trade sizes, with a 2% threshold of the 5-day average traded value allowing for trades up to ₹0.04 crore without significant market impact.

Notably, delivery volumes on 11 Feb 2026 rose by 30.49% compared to the 5-day average, reaching 32.42 thousand shares. This increase in delivery volume suggests that investors are increasingly offloading their holdings rather than engaging in intraday speculative trades, signalling a shift towards longer-term exit strategies amid deteriorating sentiment.

Sector and Market Context

The broader IT - Software sector declined by 4.8% on the same day, slightly outperforming Tera Software Ltd’s 4.0% drop. The Sensex, by comparison, fell a modest 0.43%, highlighting that the stock’s weakness is more acute than the general market trend. This underperformance relative to both the sector and benchmark index points to company-specific concerns exacerbating the negative momentum.

Over the past three consecutive trading sessions, Tera Software Ltd has lost 11.09% in value, reflecting a sustained downtrend. The stock’s moving averages reveal a mixed technical picture: it remains above the 200-day moving average but trades below the 5-day, 20-day, 50-day, and 100-day averages, indicating short- to medium-term bearishness despite some long-term support.

Investor Sentiment and Panic Selling Dynamics

The sharp fall and circuit hit reflect a wave of panic selling among investors, likely triggered by a combination of disappointing near-term outlook and broader sector weakness. The unfilled supply of shares at lower price levels suggests that sellers have overwhelmed buyers, pushing the stock down to its regulatory floor.

Such intense selling pressure often results from negative news flow, earnings concerns, or shifts in market perception about the company’s growth prospects. While no specific adverse announcement was reported on 12 Feb 2026, the persistent decline over recent sessions indicates underlying fundamental or technical challenges weighing on investor confidence.

Fundamental and Mojo Score Assessment

Tera Software Ltd holds a Mojo Score of 72.0, categorised as a Buy rating, though this represents a downgrade from its previous Strong Buy grade as of 5 Dec 2025. The downgrade signals a moderation in the company’s outlook or risk profile, which may have contributed to the recent selling pressure.

The company’s market capitalisation stands at ₹517 crore, placing it firmly in the micro-cap segment. Its Market Cap Grade is 4, reflecting moderate size and liquidity constraints relative to larger peers in the Computers - Software & Consulting sector.

Investors should note that while the Mojo Grade remains positive, the recent downgrade and price action warrant caution. The stock’s technical indicators and volume patterns suggest that the current downtrend may persist until fresh catalysts emerge to restore confidence.

Outlook and Investor Considerations

Given the current market dynamics, investors should approach Tera Software Ltd with a balanced perspective. The stock’s recent circuit hit and volume patterns highlight significant downside risk in the near term. However, the company’s Mojo Buy rating and long-term fundamentals may offer a recovery pathway once selling pressure abates.

Market participants are advised to monitor key technical levels, including the 200-day moving average, which currently acts as a support zone. Additionally, tracking sector trends and broader IT industry developments will be crucial, as these factors heavily influence Tera Software Ltd’s performance.

For risk-averse investors, waiting for confirmation of a trend reversal or improved fundamental signals before initiating fresh positions may be prudent. Conversely, more aggressive traders might view the current price levels as an opportunity to accumulate selectively, anticipating a rebound when market sentiment stabilises.

Summary

Tera Software Ltd’s plunge to its lower circuit limit on 12 Feb 2026 underscores the intense selling pressure gripping the stock amid a broader sector downturn. The maximum daily loss of 4.0%, combined with rising delivery volumes and a downgrade in Mojo Grade, paints a cautious picture for investors. While the company retains a Buy rating, the near-term outlook remains challenging, necessitating careful analysis and risk management.

Investors should remain vigilant for any fresh developments that could alter the stock’s trajectory and consider integrating comprehensive research insights to inform their decisions.

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