From 2022 through 2024, if you were holding defence stocks, chances are you had a big grin on your face. That joyride hit some bumps this year stock prices have been correcting, and it’s been a bit of a waiting game. Still, with all the chaos in the world (geopolitics, surprise tariffs from the US, you name it), the Indian defence sector is still holding up better than most. In fact, when you zoom in, shipping giants like Garden Reach Shipbuilders (GRSE) and Cochin Shipyard are quietly making their case for a comeback. I’m finding their technical charts hard to ignore.
GRSE: Finding a Foothold for the Next Climb?
GRSE is one of those stocks that keeps surprising me. I remember seeing it hit rock bottom at ₹1,190 in March 2025 and thinking, ‘Is this the end of the rally?’ But what a bounce! Nearly tripling in just three months. Since then, things have quieted down, but if you look at the charts, there’s a lot to like. It’s sitting comfortably above the 100 day moving average, and the RSI is showing some real promise. For those who enjoy poring over technicals, this is the kind of setup that makes you sit up and take notice.
Key Technical Signals for GRSE’s Potential Reversal
- Double Bottom: Here’s something interesting, GRSE is forming a double bottom near its previous all-time high. If you follow chart patterns, you’ll know that’s often a classic sign the tide might be turning.
- 100-Day Moving Average: It’s been stubbornly holding above its 100 day moving average, which is usually a good sign for long-haul investors.
- Volume Trends: I noticed the drop from ₹3,550 to ₹2,400 happened with hardly any volume spike. To me, that says the sellers aren’t too committed, sometimes, that’s a hint the downside could be limited.
- Strengthening RSI: One more thing, while the price was making new lows, the RSI started climbing. That’s what we call bullish divergence, and it can be a clue that buyers are quietly getting interested again.
Cochin Shipyard: A Classic Breakout and Retest in Play
Cochin Shipyard has been on a wild ride too. After a painful 60% drop from April 2024 to February 2025, it came roaring back, breaking out of that textbook inverted head-and-shoulders pattern and almost doubling in four months. I’ve seen it find support right where you’d expect, at those key moving averages and the previous breakout level. The RSI is also flashing some bullish signals down in oversold territory, so I wouldn’t be surprised if this story isn’t over yet.
Key Technical Levels Supporting Cochin Shipyard’s Reversal
- Retest of Breakout Level: After breaking out from an inverted head and shoulders pattern, the stock is now retesting the breakout level, often seen as an accumulation phase by investors.
- 200-Day SMA Support: Even when the broader market’s been throwing a tantrum, Cochin Shipyard has stayed above its 200-day simple moving average. That’s no small feat and tells me there’s still plenty of strength left in this name.
- Volume Confirmation: The volume spike during the breakout was hard to miss, classic sign that the big players were piling in. Lately, things have been quieter, but I see that as the bulls taking a breather before another possible leg higher.
- RSI Momentum: The 14 period RSI remains below 40 but is forming a bullish hidden divergence, supporting the case for continued upward momentum.
The Verdict: A Technical Opportunity in a Tense Market?
From my perspective, a handful of defence stocks in India are quietly staging a comeback after testing their recent lows. There’s always something to worry about geopolitics, tariffs, you name it, but even in this tricky environment, GRSE and Cochin Shipyard are showing real staying power. Their charts and underlying demand speak for themselves.
Both GRSE and Cochin Shipyard tick a lot of boxes for me right now, strong chart patterns, rising momentum, and those important breakout signals. They’ve got solid fundamentals backing them up, too. So, if you’re hunting for fresh watchlist candidates, you might want to keep these on your radar. Sometimes, the best opportunities come when everyone else is looking the other way.
Disclaimer
Note: The purpose of this article is only to share interesting charts, data points and thought-provoking opinions. It is NOT a recommendation. If you wish to consider an investment, you are strongly advised to consult your advisor. This article is strictly for educative purposes only.
As per SEBI guidelines, the writer and his dependents may or may not hold the stocks/commodities/cryptos/any other assets discussed here. However, clients of Jainam Broking Limited may or may not own these securities.
Kiran Jani has over 15 years of experience as a trader and technical analyst in India’s financial markets. He is a well-known face on the business channels as Market Experts and has worked with Asit C Mehta, Kotak Commodities, and Axis Securities. Presently, he is Head of the Technical and Derivative Research Desk at Jainam Broking Limited.
Disclosure: The writer and his dependents do not hold the stocks discussed here. However, clients of Jainam Broking Limited may or may not own these securities.
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