This defence stock turns oversold on charts, falls for fifth day; what analysts say  

Shares of Zen Technologies hit lower circuit of 5% for the second straight session on Tuesday after the defence firm reported Q1 earnings that came below estimates. Zen Technologies shares fell 5% to a low of Rs 1,603.70 in the current session against the previous close of Rs 1688.10. In the previous session too, the stock was stuck in the lower circuit of 5%. 

Analysts also attributed the fall to profit booking amid a correction in the broader market. 

Market cap of the firm slipped to Rs 14,479 crore on BSE.  With today's fall, the multibagger stock has  turned negative in a year. 

The stock is down 35% this year. However, the defence stock has gained 155.90% in two years and 
gained 814%in two years. 

The stock fell to a 52 week low of Rs 946.65 on February 19, 2025 and touched a 52 week high of Rs 2627.95 on December 24, 2024.

The RSI of the stock stands at 29.2, which indicates it's trading in the oversold zone. 

Zen Technologies stock has a one-year beta of 1.1, indicating high volatility during the period. Zen Technologies shares are trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day, 100 day and 200 day moving averages.

Earnings of the defence firm came below estimates as net profit slipped 38% to Rs 47.75 crore in Q1 against a net profit of Rs 76.81 crore in the corresponding quarter of the previous fiscal. 
 
Revenue fell 37.9% year-on-year in Q1 to Rs 158.22 crore. Operating income or earnings before interest, taxes, depreciation, and amortisation, slipped 42% year-on-year to Rs 64.70 crore. The EBITDA margin contracted 208 basis points to 40.9%.

Ravi Singh, SVP - Retail Research, Religare Broking said, "The stock price has corrected by over 20% since June 2025. Zen Tech hit two lower circuits of 5% on July 28 and July 29, following a Q1 profit decline. This small-cap defence stock is now trading below its key moving averages—the 20-day and 50-day EMA—and may witness a bearish “death cross” soon, as the 20-day EMA looks set to cross below the 50-day EMA. Overall , price structure remains cautious and investors should ignore adding fresh position in this stock. Investors are advised to exit existing long positions to guard against further downside, as the price could decline toward the Rs 1,550 to Rs 1,500 range in the near term."

Om Mehra, Technical Research Analyst, SAMCO Securities said, "Zen Technologies has entered a corrective phase following its sharp rally from the recent highs. The stock has gradually drifted lower over the past several weeks and now trades below both the 50-day and 200-day simple moving averages, indicating a weakening short-term outlook. The recent candle reflects a clean break down below the Rs 1,720-Rs 1,750 support band, with increased bearish momentum and 5% double-day decline. 

The zone around Rs 1,600 may act as a short-term support, but failure to stabilize here could extend the fall toward the Rs 1,550 mark, which aligns with previous swing zones and psychological support.

The daily RSI has declined to 29, entering oversold territory, which may prompt a short-term pullback. However, the MACD remains deeply negative with no signs of convergence yet, highlighting the current weakness. The volume has picked up on red candles in recent sessions, reflecting delivery-based exits rather than healthy consolidation.

At this juncture, a relief bounce cannot be ruled out due to the oversold RSI, but the broader trend remains under pressure unless the stock reclaims Rs 1,780 on a closing basis. A sustained move above this level could help restore positive bias.

Until then, investors should wait for a confirmed base formation or signs of stabilization near Rs 1,600–Rs 1,620 before considering re-entry. Fresh positions may be avoided until momentum indicators show early reversal signals."

Zen Technologies Limited designs, develops, and manufactures defence training systems, based on sensors and simulators technology. The company’s category of products includes land-based military training simulators, driving simulators, live range equipment and anti-drone systems. The company also has a training platform in Hyderabad, with an integration of its complete product range. Its Anti-Drone System (ZADS) system works on drone detection, classification and tracking on passive surveillance, camera sensors and neutralization of threat by jamming drone communication.