Asian Paints Sees Sharp Open Interest Surge Amid Mixed Market Signals

Open Interest and Volume Dynamics

On 24 Feb 2026, Asian Paints recorded an open interest of 1,03,026 contracts, up from 93,350 contracts the previous day, marking an absolute increase of 9,676 contracts or 10.37%. This rise in OI was accompanied by a futures volume of 48,066 contracts, indicating robust trading activity in the derivatives market. The futures value stood at ₹1,18,845.99 lakhs, while the options segment exhibited an exceptionally high notional value of approximately ₹17,716.84 crores, underscoring significant speculative and hedging interest.

The total combined value of futures and options contracts reached ₹1,20,460.16 lakhs, reflecting substantial liquidity and investor engagement in Asian Paints derivatives. The underlying stock price was ₹2,410, providing a reference point for the derivatives pricing and positioning.

Price Performance and Technical Indicators

Despite the surge in derivatives activity, Asian Paints’ stock price declined by 0.91% on the day, underperforming the paints sector’s 0.78% fall and the Sensex’s broader 1.35% decline. This underperformance suggests that while derivatives traders are increasing their positions, the cash market is experiencing selling pressure or profit-taking.

Technically, the stock is trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a bearish trend or consolidation phase. The recent price action also marks a reversal after two consecutive days of gains, indicating potential short-term weakness or correction.

Investor Participation and Liquidity

Investor participation in the cash segment has risen notably, with delivery volumes on 23 Feb reaching 7.44 lakh shares, a 41.11% increase over the five-day average delivery volume. This heightened delivery volume suggests stronger conviction among investors holding the stock beyond intraday trading, which could provide some support amid price volatility.

Liquidity remains adequate for sizeable trades, with the stock’s average traded value supporting trade sizes up to ₹4.53 crores based on 2% of the five-day average traded value. This liquidity facilitates smooth execution of large orders without significant price impact, an important factor for institutional investors and derivatives traders alike.

Market Positioning and Directional Bets

The sharp increase in open interest alongside rising volumes in Asian Paints derivatives suggests that market participants are actively repositioning. The 10.37% OI growth indicates fresh capital inflows or rollovers of existing positions, which could be either bullish or bearish depending on the nature of contracts (calls or puts) and strike prices involved.

Given the stock’s recent price decline and trading below all major moving averages, some traders may be increasing put option positions or short futures contracts as a hedge or to capitalise on anticipated downside. Conversely, the elevated delivery volumes in the cash market imply that long-term investors remain committed, possibly viewing the current dip as a buying opportunity.

Asian Paints’ Mojo Score currently stands at 57.0 with a Mojo Grade of Hold, downgraded from Buy on 16 Jan 2026. This reflects a cautious stance amid mixed technical and fundamental signals. The market cap grade is 1, indicating a large-cap status with strong institutional interest but also heightened scrutiny.

Sector and Broader Market Context

Within the paints sector, Asian Paints remains a bellwether stock, and its derivatives activity often presages sector-wide trends. The sector’s 0.78% decline on the day, coupled with Asian Paints’ underperformance, may reflect concerns over raw material costs, margin pressures, or subdued demand outlooks. However, the stock’s large market capitalisation of ₹2,33,315 crores and strong brand presence continue to attract investor interest despite short-term volatility.

Comparatively, the Sensex’s 1.35% fall indicates broader market weakness, possibly driven by macroeconomic factors or global cues. Asian Paints’ relatively smaller decline suggests some resilience, supported by steady delivery volumes and active derivatives positioning.

Implications for Investors and Traders

The current surge in open interest and volume in Asian Paints derivatives highlights an active market environment where investors are recalibrating their positions amid uncertain price direction. Traders should closely monitor the evolving OI patterns, particularly the ratio of call to put options and futures positioning, to gauge market sentiment more precisely.

For long-term investors, the increased delivery volumes suggest underlying confidence in the company’s fundamentals despite short-term price weakness. However, the downgrade in Mojo Grade to Hold signals the need for caution and a watchful approach until clearer trend confirmation emerges.

Given the stock’s large-cap status and liquidity, it remains a key candidate for portfolio allocation, but investors should balance exposure with sector and market-wide risks. The mixed signals from derivatives and cash markets underscore the importance of a disciplined investment strategy and risk management.

Conclusion

Asian Paints Ltd.’s recent open interest surge in derivatives, combined with increased delivery volumes and a modest price decline, paints a nuanced picture of market sentiment. While derivatives traders appear to be positioning for potential volatility, the underlying investor base shows resilience. The stock’s technical weakness and downgrade to Hold suggest a cautious outlook, but its large-cap stature and sector leadership continue to make it a focal point for investors seeking exposure to the paints industry.

Market participants should remain vigilant to further developments in open interest, volume trends, and price action to better understand the directional bias and adjust their strategies accordingly.

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