Tera Software Ltd Hits Upper Circuit Amid Strong Buying Pressure

Intraday Price Movement and Volatility

On 6 February, Tera Software Ltd’s stock price exhibited significant volatility, touching an intraday high of ₹427.55, marking a 5.0% increase from the previous close. The intraday low was ₹391.20, representing a 3.93% dip, reflecting a wide trading range and active market participation. The stock’s weighted average price leaned closer to the lower end of the day’s range, indicating that while the price surged towards the close, a considerable volume was traded near the lows earlier in the session.

The intraday volatility was calculated at 5.43%, underscoring the stock’s heightened price swings during the trading day. Despite this, the stock outperformed its sector by 7.0%, with the Computers - Software & Consulting sector declining by 1.88% and the Sensex remaining almost flat with a marginal 0.02% loss.

Volume and Liquidity Analysis

Trading volumes for Tera Software Ltd stood at 0.18208 lakh shares, translating to a turnover of approximately ₹0.74 crore. While this volume is modest, it is sufficient to maintain liquidity for trades up to ₹0.02 crore, based on 2% of the five-day average traded value. However, delivery volumes have seen a sharp decline; on 5 February, delivery volume was 10,770 shares, down 53.64% compared to the five-day average, suggesting that short-term traders and speculators may be dominating the current price action rather than long-term holders.

Technical Positioning and Moving Averages

From a technical standpoint, Tera Software Ltd’s last traded price (LTP) of ₹427.55 is positioned above its 5-day, 20-day, and 200-day moving averages, signalling short- and long-term bullish momentum. However, it remains below the 50-day and 100-day moving averages, indicating that medium-term resistance levels have yet to be decisively breached. This mixed technical picture suggests that while immediate buying interest is strong, the stock may face hurdles in sustaining momentum without broader market support or fundamental catalysts.

Market Capitalisation and Sector Context

Tera Software Ltd is classified as a micro-cap stock with a market capitalisation of ₹498 crore. Operating within the Computers - Software & Consulting sector, the company’s recent price action stands out against a backdrop of sector weakness. The sector’s 1-day return was negative at -1.88%, while the broader Sensex index was nearly flat. This divergence highlights the stock’s relative strength and investor preference amid a cautious market environment.

Mojo Score and Analyst Ratings

The company holds a Mojo Score of 78.0, which corresponds to a ‘Buy’ grade. This rating was revised from a previous ‘Strong Buy’ on 5 December 2025, reflecting a slight moderation in analyst enthusiasm. The Market Cap Grade is 4, indicating a mid-tier valuation relative to peers. The downgrade from ‘Strong Buy’ to ‘Buy’ suggests that while the stock remains attractive, investors should monitor upcoming developments and market conditions closely.

Regulatory Freeze and Unfilled Demand

Due to the stock hitting its upper circuit limit of 5%, trading was subject to a regulatory freeze, preventing further price increases for the day. This freeze is a mechanism designed to curb excessive volatility and protect investors from speculative excesses. The upper circuit hit also indicates unfilled demand, as buy orders exceeded sell orders at the price cap, signalling strong bullish sentiment and potential for further gains once the freeze is lifted.

Trend Reversal and Investor Sentiment

After two consecutive days of decline, Tera Software Ltd’s price reversal on 6 February is a positive technical development. The stock’s ability to rebound with a maximum gain of 5.0% suggests renewed investor interest and confidence in the company’s prospects. However, the falling delivery volumes imply that this rally may be driven more by short-term speculative activity than by sustained accumulation by long-term investors.

Investor Takeaway and Outlook

For investors, Tera Software Ltd’s upper circuit hit is a clear signal of strong buying momentum and market interest. The stock’s outperformance relative to its sector and the broader market, combined with a solid Mojo Score and a ‘Buy’ rating, make it an attractive candidate for inclusion in a diversified portfolio focused on micro-cap technology stocks.

However, caution is warranted given the recent decline in delivery volumes and the regulatory freeze, which may limit immediate upside. Investors should watch for confirmation of sustained volume support and monitor the stock’s ability to break above medium-term moving averages to validate a longer-term uptrend.

Overall, Tera Software Ltd’s price action on 6 February 2026 reflects a compelling mix of strong demand, technical resilience, and sector-relative strength, positioning it well for potential further gains in the near term.

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