Adani Green Energy Sees Sharp Open Interest Surge Amid Volatile Trading

Open Interest and Volume Dynamics

On 23 Jan 2026, Adani Green Energy's open interest (OI) in derivatives rose sharply by 10,525 contracts, a 16.74% increase from the previous day's 62,878 contracts to 73,403 contracts. This notable expansion in OI was accompanied by a substantial volume of 1,22,659 contracts traded, indicating robust participation in the derivatives market. The futures segment alone accounted for a value of approximately ₹1,26,588 lakhs, while the options segment's notional value was significantly higher at ₹52,602,556 lakhs, culminating in a total derivatives value of ₹1,36,918 lakhs.

The surge in open interest alongside high volumes typically suggests fresh positions being initiated rather than existing ones being squared off. In this context, the increase in OI amid a steep price decline points towards traders possibly building bearish positions or hedging existing long exposures.

Price Action and Volatility Context

Adani Green's stock price underperformed its sector and the broader market on the day. The share closed down by 11.16%, touching an intraday low of ₹797.3, a drop of 11.83% from the previous close. The stock traded within a wide range of ₹111.7, reflecting heightened volatility with an intraday volatility measure of 8.89% based on the weighted average price. Notably, the weighted average price skewed closer to the day's low, indicating selling pressure throughout the session.

Further compounding the bearish sentiment, the stock traded below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a sustained downtrend. The Power Generation and Distribution sector, to which Adani Green belongs, also declined by 3.26%, but the stock's fall was markedly sharper, underscoring company-specific pressures.

Investor Participation and Liquidity

Investor participation showed signs of waning, with delivery volumes on 22 Jan falling by 36.41% to 5.21 lakh shares compared to the five-day average. This decline in delivery volume suggests that fewer investors were holding shares for the long term, possibly reflecting a shift towards short-term trading or profit booking. Despite this, liquidity remained adequate, with the stock's average traded value supporting trade sizes up to ₹3.98 crore, ensuring that market participants could execute sizeable trades without significant price impact.

Market Positioning and Directional Bets

The sharp rise in open interest amid falling prices suggests that market participants are increasingly positioning for further downside in Adani Green Energy. The derivatives data implies that traders may be initiating fresh short positions or buying put options to hedge against potential declines. The disproportionate increase in options notional value compared to futures also indicates heightened activity in option contracts, which are often used for directional bets or volatility plays.

Given the stock's underperformance relative to the sector and the broader Sensex, which declined by only 0.91% on the same day, the market appears to be factoring in company-specific risks. These could include concerns over earnings, regulatory developments, or sectoral headwinds impacting renewable energy firms. The downgrade in the Mojo Grade from Sell to Strong Sell on 5 Jan 2026, with a low Mojo Score of 21.0, further corroborates the negative outlook.

Technical and Fundamental Considerations

Technically, the stock's failure to hold above key moving averages and the high intraday volatility signal a bearish trend that may persist in the near term. The wide trading range and volume concentration near the lows suggest sellers dominated the session. Fundamentally, despite being a large-cap company with a market capitalisation of ₹1,30,143.39 crore, Adani Green's current market cap grade of 1 and deteriorating investor sentiment highlight challenges ahead.

Investors should also note the falling delivery volumes, which indicate reduced long-term conviction. This shift towards short-term trading could exacerbate price swings and increase volatility in the coming sessions.

Implications for Investors and Traders

For investors, the current market signals advise caution. The strong sell rating and deteriorating technical indicators suggest that holding or initiating long positions may carry elevated risk. Traders, on the other hand, may find opportunities in the increased volatility and open interest, particularly through options strategies that capitalise on directional moves or hedging requirements.

Given the large derivatives notional values and the stock’s liquidity, institutional players are likely active in shaping the price action. Monitoring open interest trends alongside price movements will be crucial to gauge whether the bearish momentum sustains or if a reversal emerges.

Outlook and Conclusion

Adani Green Energy Ltd’s derivatives market activity on 23 Jan 2026 reveals a clear shift towards bearish positioning amid a volatile trading environment. The 16.74% jump in open interest, combined with a steep price decline and underperformance relative to sector peers, underscores growing concerns among market participants.

While the company remains a large-cap player in the power sector, the current technical and sentiment indicators suggest that investors should remain vigilant. The stock’s failure to hold key moving averages and the drop in delivery volumes point to weakening investor confidence. Traders may continue to exploit the volatility through derivatives, but the overall outlook remains cautious until clearer signs of recovery or stability emerge.

In summary, the surge in open interest and volume patterns in Adani Green Energy’s derivatives market provide valuable insights into market positioning and potential directional bets. These developments warrant close monitoring as they could presage further price action in the near term.

Unlock special upgrade rates for a limited period. Start Saving Now →