Alkem Laboratories Sees Significant Open Interest Surge Amid Rising Market Activity

Open Interest and Volume Dynamics

On 23 Feb 2026, Alkem Laboratories recorded an open interest of 19,747 contracts, up from 17,449 the previous session, marking an absolute increase of 2,298 contracts. This 13.17% rise in OI is significant, especially when viewed alongside the day's volume of 14,324 contracts. The futures segment alone accounted for a value of approximately ₹35,645.93 lakhs, while options contributed a staggering ₹6,101.04 crores, culminating in a total derivatives value exceeding ₹35,878.86 lakhs.

The underlying stock price stood at ₹5,445, reflecting a 1.30% gain on the day, outperforming its sector by 0.66% and the Sensex by 0.90%. Notably, Alkem has been on a two-day consecutive gain streak, delivering a cumulative return of 1.27%, indicating sustained investor interest.

Market Positioning and Moving Averages

Technical indicators reveal that Alkem's price is trading above its 5-day and 200-day moving averages, signalling short-term and long-term bullish tendencies. However, it remains below the 20-day, 50-day, and 100-day moving averages, suggesting some resistance in the medium term. This mixed technical picture may be influencing cautious positioning among traders and investors.

Investor participation has also risen sharply, with delivery volumes on 20 Feb reaching 1.86 lakh shares, a 45.16% increase compared to the five-day average. This heightened delivery volume underscores genuine buying interest rather than speculative trading, reinforcing the stock's liquidity and attractiveness for sizeable trades, with an estimated tradable value of ₹1.95 crore based on 2% of the five-day average traded value.

Interpreting the Open Interest Surge

The 13.17% increase in open interest is a clear indication of fresh positions being established in Alkem Laboratories derivatives. When combined with rising volumes and a positive price trend, this typically points to bullish sentiment among market participants. Traders appear to be positioning for further upside, possibly anticipating favourable developments in the pharmaceutical sector or company-specific catalysts.

However, the fact that the stock remains below several medium-term moving averages suggests some caution. The market may be awaiting confirmation of sustained momentum before committing fully. The delivery volume spike supports the view that institutional investors are accumulating shares, which could provide a solid foundation for future gains.

Mojo Score and Rating Revision

Alkem Laboratories currently holds a Mojo Score of 52.0, categorised as a Hold, reflecting a recent downgrade from a Buy rating on 1 Dec 2025. This adjustment indicates a more cautious stance by analysts, possibly due to valuation concerns or sector headwinds. The Market Cap Grade stands at 2, consistent with its mid-cap status and liquidity profile.

Despite the Hold rating, the stock’s recent outperformance relative to its sector and the Sensex, combined with the derivatives market activity, suggests that traders are optimistic about near-term prospects. Investors should weigh these factors carefully, considering both the technical signals and fundamental outlook.

Sector and Market Context

The Pharmaceuticals & Biotechnology sector has been under moderate pressure recently, with many stocks consolidating after strong rallies in the previous quarters. Alkem’s ability to outperform its sector by 0.66% on the day is noteworthy and may reflect company-specific strengths such as robust product pipelines, regulatory approvals, or favourable earnings guidance.

Given the sector’s importance in the broader market and its sensitivity to policy changes, investors are closely monitoring open interest and volume patterns as leading indicators of sentiment shifts. Alkem’s derivatives activity could be a bellwether for renewed interest in pharmaceutical mid-caps.

Potential Directional Bets and Investor Implications

The surge in open interest, coupled with rising volumes and positive price action, suggests that market participants are increasingly bullish on Alkem Laboratories. The derivatives market activity points to directional bets favouring upside moves, with traders likely utilising futures and call options to leverage their positions.

Investors should note that while the short-term technical indicators are encouraging, the stock’s position below key medium-term moving averages warrants caution. The Hold rating and Mojo Score reflect this balanced outlook. Those considering fresh exposure may wish to monitor further confirmation signals such as sustained volume increases, a break above the 20-day and 50-day moving averages, or positive sector developments.

Additionally, the increased delivery volumes indicate genuine accumulation rather than speculative trading, which bodes well for price stability. However, given the mid-cap nature of Alkem Laboratories and the inherent volatility in the pharmaceutical sector, risk management remains paramount.

Conclusion

Alkem Laboratories Ltd’s recent open interest surge in derivatives highlights a shift towards more bullish market positioning, supported by rising volumes and positive price momentum. While the stock currently holds a Hold rating with a Mojo Score of 52.0, the evolving market dynamics suggest potential for further gains if technical resistance levels are overcome.

Investors should carefully analyse the interplay of technical signals, sector trends, and fundamental factors before making decisions. The derivatives market activity serves as a valuable barometer of sentiment, signalling that Alkem Laboratories remains a key stock to watch within the Pharmaceuticals & Biotechnology sector.

Only Rs. 9,999 - Get MojoOne for 1 Year + 3 Months FREE (60% Off) Start Today