Rs 1,020 and Rs 1,030 Puts Draw 6,491 Contracts on Bajaj Finance Ltd Ahead of 29 Sep Expiry

Put Options Event and Cash Market Context

On 23 Sep 2026, the most active put strikes for Bajaj Finance Ltd were Rs 1,020 and Rs 1,030, with 3,951 and 2,540 contracts traded respectively. The combined turnover for these strikes was approximately ₹440.5 lakhs, signalling significant premium flow. Open interest at these strikes stands at 2,591 and 1,949 contracts, indicating a substantial build-up of positions ahead of the 29 Sep expiry. Meanwhile, the underlying stock price closed at Rs 1,029.60, just below the Rs 1,030 strike, and posted a 2.20% gain on the day, outperforming its sector by 1.09%.

This juxtaposition of rising stock price and heavy put activity invites a deeper look into the nature of these trades — are traders hedging recent gains or positioning for a downturn?

Strike Price Analysis: Moneyness and Distance from Underlying

The Rs 1,030 put strike is effectively at-the-money (ATM), given the stock's close proximity at Rs 1,029.60. The Rs 1,020 strike is slightly out-of-the-money (OTM), about 0.9% below the current price. Neither strike is deep in-the-money (ITM), which would have suggested a more overtly bearish stance. The closeness of these strikes to the underlying price suggests that the put activity is concentrated around near-term downside protection levels rather than speculative bets on a sharp decline.

Given the stock's recent upward momentum, the Rs 1,020 put strike sits just below key short-term moving averages, potentially aligning with technical support zones. This positioning often corresponds to hedging strategies designed to protect gains without signalling outright bearish conviction — how does this technical alignment influence the interpretation of the put activity?

Interpreting the Put Activity: Hedging, Bearish Bets, or Put Writing?

Put options inherently carry ambiguous signals. They can represent bearish bets if bought outright, protective hedges if purchased to guard existing long positions, or bullish put writing if sold to collect premium with the expectation that the stock will hold above the strike.

In this case, the stock has gained 2.20% on the day and is trading above its 5-day, 100-day, and 200-day moving averages, though still below the 20-day and 50-day averages. This mixed technical picture, combined with the ATM and slightly OTM strikes, suggests that the put activity is more consistent with hedging than directional bearishness. The Rs 1,020 strike, close to a support zone, is a logical level for protective puts to limit downside risk without signalling a bet on a steep fall.

Put writing is less likely here given the high turnover and open interest build-up, which points to fresh positioning rather than premium collection. However, some portion of the activity could be put sellers confident in the stock's near-term stability.

Open Interest and Contracts Analysis

The ratio of contracts traded to open interest is notable. For the Rs 1,020 strike, 3,951 contracts traded against an open interest of 2,591, a ratio of approximately 1.5:1, indicating fresh activity but not an overwhelming surge. The Rs 1,030 strike shows 2,540 contracts traded versus 1,949 open interest, a similar ratio. This suggests a combination of new positions and adjustments to existing ones rather than a pure unwinding or fresh directional bet.

Such moderate fresh positioning supports the interpretation of hedging or cautious positioning rather than aggressive bearish speculation.

Cash Market Momentum and Technical Context

Bajaj Finance Ltd has reversed a two-day decline with a 2.20% gain on 23 Sep, opening with a gap up and touching an intraday high of Rs 1,030. The stock trades above its 5-day, 100-day, and 200-day moving averages, which typically signals short-term strength, though it remains below the 20-day and 50-day averages, indicating some resistance in the medium term.

Delivery volumes have declined by 23.55% compared to the 5-day average, suggesting that the rally may lack strong conviction from long-term holders. This thinning participation could be a reason why traders are buying puts as a protective measure — should investors consider hedging their positions amid this mixed volume backdrop?

Delivery Volume and Market Liquidity

Delivery volume on 22 Sep was 30.03 lakh shares, down 23.55% from the 5-day average, indicating reduced participation by long-term holders. Despite this, the stock remains liquid enough to support trades worth approximately ₹11.51 crore based on 2% of the 5-day average traded value. This liquidity ensures that option market activity is supported by a reasonably active cash market, though the decline in delivery volume may be prompting some investors to seek downside protection.

Summary of Key Data at a Glance

Conclusion: Protective Hedging Most Likely Explanation

The combination of near-ATM and slightly OTM put strikes, significant fresh contracts traded, and a rising stock price suggests that the put activity on Bajaj Finance Ltd is primarily protective hedging rather than outright bearish positioning. The stock's technical setup, with support near the put strikes and mixed moving average signals, aligns with investors seeking downside insurance amid a rally that lacks strong delivery-backed conviction.

While some put writing cannot be ruled out, the volume and open interest patterns point to cautious positioning rather than aggressive premium collection. This nuanced interpretation highlights the importance of connecting options data with cash market context — should investors consider hedging their own positions in line with this activity?

Risk Disclaimer
Options trading involves significant risk and is not suitable for all investors. The interpretations presented here are data-driven observations and do not constitute investment advice.

Get 33% Off on our 1 Year Plan - Limited Period Only! Start Today