Why is Sasken Technol. falling/rising?

Recent Price Movement and Market Context

The stock’s fall on 17-Dec is part of a three-day losing streak, during which Sasken Technologies has declined by approximately 4.42%. The intraday low of ₹1,175 represents the lowest price level the stock has reached in the past year, signalling persistent selling pressure. This underperformance is further highlighted by the stock’s relative weakness compared to its sector, as it underperformed the sector by 3.27% on the day.

Trading volumes also suggest that the decline is supported by increased investor participation. Delivery volumes on 16-Dec rose by 33.27% compared to the five-day average, indicating that more investors are actively selling or exiting positions. Additionally, the weighted average price shows that a greater volume of shares traded closer to the day’s low, reinforcing the bearish sentiment.

Technical Indicators Point to Continued Weakness

From a technical perspective, Sasken Technologies is trading below all major moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages. This alignment of moving averages below the current price is a classic indicator of a bearish trend, suggesting that the stock is struggling to find support at higher levels. Such a technical setup often deters short-term buyers and encourages further selling pressure.

Liquidity remains adequate, with the stock’s traded value sufficient to support trades of around ₹0.05 crore based on 2% of the five-day average traded value. This liquidity ensures that the stock can be actively traded without excessive price impact, but it also means that the downward momentum can be sustained by active sellers.

Long-Term Performance Comparison

When analysing Sasken Technologies’ performance relative to the benchmark Sensex, the stock has significantly lagged over the past year and year-to-date periods. While the Sensex has delivered positive returns of 4.8% over one year and 8.22% year-to-date, Sasken has declined by 43.37% and 44.58% respectively over the same periods. Even over the past month, the stock’s loss of 16.85% starkly contrasts with the Sensex’s marginal decline of 0.46%. This persistent underperformance highlights challenges specific to the company or sector that have weighed on investor confidence.

Over longer horizons, Sasken has posted gains of 21.65% over three years and 59.13% over five years, but these returns still trail the Sensex’s 37.86% and 80.33% gains respectively. This relative underperformance over multiple time frames may contribute to the cautious stance investors are currently adopting.

Investor Sentiment and Outlook

The combination of a fresh 52-week low, consecutive days of decline, and trading below key moving averages suggests that investor sentiment towards Sasken Technologies remains subdued. The increased delivery volumes indicate that shareholders are actively reducing exposure, possibly reflecting concerns about the company’s near-term prospects or broader sector challenges.

While the stock remains liquid enough for routine trading, the lack of positive catalysts or a rebound in price levels means that the downtrend may persist until there is a clear shift in fundamentals or market sentiment. Investors should closely monitor upcoming corporate developments and sector trends to gauge any potential reversal.

Conclusion

On 17-Dec, Sasken Technologies Ltd’s share price decline to ₹1,175.00 was driven by sustained selling pressure, technical weakness, and underperformance relative to the broader market and sector peers. The stock’s fall to a new 52-week low, combined with increased investor participation in selling, underscores a cautious market stance. Until there is evidence of improved fundamentals or a technical turnaround, the stock is likely to remain under pressure in the near term.

Get 2 full years of MojoOne Premium for only Rs. 12,999. Subscribe for 1 year and we'll add another year FREE. Offer valid for a limited time. Start Saving Now →