Asian Paints Ltd Sees Surge in Call Option Activity Ahead of February Expiry

Robust Call Option Trading Highlights Bullish Positioning

On 27 Jan 2026, Asian Paints emerged as one of the most actively traded stocks in the call options segment. The most active contract was the call option with a strike price of ₹2,700, expiring on 24 Feb 2026. This contract saw a substantial volume of 12,001 contracts traded, generating a turnover of approximately ₹1950.46 lakhs. Open interest for this strike stands at 1,701 contracts, indicating sustained trader interest and potential accumulation ahead of expiry.

The underlying stock price at the time was ₹2,612.7, placing the ₹2,700 strike about 3.2% out-of-the-money. The heavy call buying at this strike suggests that market participants are positioning for a moderate upside move in Asian Paints over the next month, reflecting confidence in the stock’s near-term appreciation potential.

Price Performance and Technical Context

Asian Paints has underperformed slightly in the immediate term, with a 1-day return of -1.26% compared to the paints sector’s -1.50% and the Sensex’s marginal decline of -0.06%. The stock has also recorded a consecutive two-day decline, losing 1.09% cumulatively. Despite this short-term weakness, the stock remains above its 100-day and 200-day moving averages, signalling a longer-term uptrend. However, it is currently trading below its 5-day, 20-day, and 50-day moving averages, indicating some near-term consolidation or correction.

Investor participation has been rising, with delivery volumes reaching 9.33 lakhs on 23 Jan, a 34.28% increase over the 5-day average delivery volume. This uptick in delivery volume suggests that investors are actively accumulating shares, potentially anticipating a rebound or positive catalyst in the near future.

Fundamental and Market Positioning

Asian Paints is a large-cap stock with a market capitalisation of ₹2,61,381 crores, firmly entrenched in the paints industry. The company’s Mojo Score currently stands at 67.0, reflecting a Hold rating, a downgrade from a previous Buy rating as of 16 Jan 2026. This adjustment reflects a more cautious stance amid recent price volatility and sector dynamics.

The stock’s Market Cap Grade is rated 1, indicating its status as a large-cap heavyweight. Despite the downgrade, Asian Paints continues to outperform its sector by 0.43% on the day, underscoring its relative resilience amid broader market pressures.

Expiry Patterns and Derivatives Market Implications

The February expiry cycle is attracting significant attention from options traders, with Asian Paints’ call options at ₹2,700 strike price dominating volumes. The open interest build-up at this strike suggests that traders are betting on a price recovery or breakout above this level within the next four weeks. This is a critical threshold, as a sustained move above ₹2,700 could trigger further bullish momentum and potentially attract fresh buying interest.

Moreover, the liquidity profile of Asian Paints supports sizeable trades, with the stock’s traded value liquidity estimated at ₹7.05 crores based on 2% of the 5-day average traded value. This ensures that institutional and retail participants can execute large orders without significant market impact, facilitating active derivatives positioning.

Balancing Bullish Sentiment with Caution

While the surge in call option activity signals optimism, the recent downgrade from Buy to Hold by MarketsMOJO and the stock’s short-term price weakness counsel prudence. Investors should weigh the potential for a rebound against the risk of further consolidation, especially given the stock’s current position below key short-term moving averages.

Asian Paints’ fundamental strength, large-cap status, and sector leadership remain intact, but near-term catalysts will be crucial in determining whether the bullish derivatives positioning translates into sustained price gains.

Investor Takeaways and Outlook

For investors tracking Asian Paints, the current derivatives activity offers valuable insights into market expectations. The heavy call option volumes at the ₹2,700 strike price indicate a consensus view that the stock could rally beyond this level by late February. However, the recent downgrade and short-term price softness suggest that caution is warranted.

Investors should monitor upcoming earnings announcements, sector developments, and broader market trends to gauge whether the bullish positioning in options markets is justified. Additionally, tracking changes in open interest and volume in the lead-up to expiry will provide clues on whether traders are rolling positions or closing out bets.

Overall, Asian Paints remains a key stock to watch within the paints sector, balancing solid fundamentals with evolving technical signals and active derivatives market interest.

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