Axis Bank Sees Heavy Put Option Activity Amid Mixed Market Signals

Robust Put Option Volumes Highlight Investor Caution

Data from the derivatives market reveals that Axis Bank’s put options have attracted significant trading interest, with three strike prices dominating activity for the 24 February expiry. The 1,300 strike put saw the highest number of contracts traded at 2,883, followed closely by the 1,350 strike with 2,752 contracts and the 1,320 strike with 1,969 contracts. This surge in put option volumes corresponds to a combined turnover exceeding ₹97 crores, underscoring the substantial capital flow directed towards downside protection or speculative bearish bets.

Open interest figures further confirm sustained investor interest, with the 1,300 strike put holding an open interest of 2,222 contracts, the 1,320 strike at 1,803, and the 1,350 strike at 912 contracts. These levels indicate that traders are positioning themselves for potential downside moves or are actively hedging existing long exposures in the stock.

Stock Performance Contrasts with Put Option Activity

Interestingly, Axis Bank’s underlying equity has been demonstrating resilience. The stock hit a new 52-week high of ₹1,369.4 on 28 January 2026, outperforming its sector by 1.07% and the broader Sensex by 2.11%. It has recorded a consecutive two-day gain, delivering a 7.39% return over this period. The stock opened with a gap-up of 2.45% and traded above all key moving averages, including the 5-day, 20-day, 50-day, 100-day, and 200-day averages, signalling a strong technical uptrend.

Investor participation has also surged, with delivery volumes on 27 January rising by 231.47% compared to the five-day average, reaching 1.56 crore shares. Liquidity remains robust, supporting trade sizes of up to ₹28.53 crores comfortably. This juxtaposition of strong price action and heavy put option activity suggests a complex market sentiment where investors are simultaneously optimistic on the stock’s fundamentals yet cautious about near-term volatility or potential corrections.

Interpreting the Put Option Interest: Hedging or Bearish Bets?

The concentration of put option activity at strike prices slightly below and near the current market price of ₹1,352 suggests that market participants are preparing for a possible pullback or increased volatility in the near term. The 1,300 and 1,320 strikes, in particular, represent key support levels where investors may seek protection against downside risk.

Given Axis Bank’s recent upgrade from a Sell to a Hold rating on 15 October 2025, with a Mojo Score of 67.0, the market appears to be in a state of cautious optimism. The bank’s large-cap status with a market capitalisation of ₹4,08,177 crores and a Market Cap Grade of 1 further supports its fundamental strength. However, the elevated put option volumes indicate that traders are not fully convinced of a sustained rally and are either hedging existing long positions or speculating on a correction.

Expiry Patterns and Market Sentiment

The 24 February 2026 expiry is attracting the bulk of put option interest, which is typical as traders adjust their positions ahead of monthly expiries. The open interest data shows a healthy build-up in these strikes, which could translate into increased price sensitivity around these levels as expiry approaches. This dynamic often leads to heightened volatility, especially if the stock price approaches these strike prices, triggering option-related hedging flows.

Moreover, the turnover figures reveal that the 1,350 strike put option commands the highest turnover at ₹49.9 crores, despite having the lowest open interest among the three strikes. This suggests active trading and possibly short-term speculative positioning at this level, reflecting a nuanced market view that balances between near-term caution and longer-term confidence.

Sector and Market Context

Axis Bank’s outperformance relative to the Private Sector Bank sector, which gained 1.46% on the day, and the Sensex’s modest 0.52% rise, highlights its relative strength. However, the sector itself faces headwinds from macroeconomic uncertainties and regulatory developments, which may be contributing to the cautious stance reflected in the options market.

Investors should note that while the stock’s technical indicators remain bullish, the elevated put option activity signals a hedging mindset that could cap upside momentum in the short term. This duality is common in large-cap banking stocks where fundamental strength coexists with tactical risk management by market participants.

Outlook and Investor Takeaways

For investors and traders, the current scenario presents a mixed picture. Axis Bank’s recent upgrade to a Hold rating and its strong technical momentum suggest a stable medium-term outlook. However, the heavy put option activity at strikes close to the current market price indicates that market participants are wary of potential near-term corrections or volatility spikes.

Those holding long positions may consider the elevated put option volumes as a signal to implement protective strategies, such as buying puts or tightening stop-loss levels. Conversely, speculative traders might view the put option interest as an opportunity to capitalise on short-term downside moves, especially if macroeconomic or sector-specific catalysts emerge.

Overall, Axis Bank remains a key stock to watch within the private sector banking space, balancing strong fundamentals with tactical market caution as reflected in its derivatives activity.

Summary of Key Metrics for Axis Bank Ltd.

• Current Price: ₹1,352.0

• 52-Week High: ₹1,369.4 (28 Jan 2026)

• Market Capitalisation: ₹4,08,177 crores (Large Cap)

• Mojo Score: 67.0 (Hold, upgraded from Sell on 15 Oct 2025)

• Sector Performance (1D): +1.46%

• Sensex Performance (1D): +0.52%

• Put Option Strike Prices (24 Feb 2026 Expiry): 1,300 / 1,320 / 1,350

• Put Option Contracts Traded: 2,883 / 1,969 / 2,752 respectively

• Open Interest: 2,222 / 1,803 / 912 respectively

• Turnover: ₹24.78 crores / ₹22.69 crores / ₹49.91 crores respectively

Investors should continue to monitor both the equity and derivatives markets for evolving signals as the 24 February expiry approaches, adjusting their strategies accordingly to balance risk and reward in this dynamic environment.

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