Bandhan Bank Sees Sharp Open Interest Surge Amid Strong Derivatives Activity

Open Interest and Volume Dynamics

On 26 Feb 2026, Bandhan Bank’s open interest (OI) in derivatives rose sharply by 3,361 contracts, representing an 11.68% increase from the previous day’s 28,781 contracts to 32,142 contracts. This surge in OI was accompanied by a volume of 29,607 contracts, indicating heightened trading activity and fresh positions being established rather than merely unwinding existing ones.

The futures segment alone accounted for a value of approximately ₹48,919.66 lakhs, while the options segment’s notional value stood at a substantial ₹15,726.01 crores, culminating in a total derivatives value of ₹53,602.30 lakhs. Such elevated figures underscore the growing interest in Bandhan Bank’s derivatives, reflecting increased speculative and hedging activity.

Price Performance and Technical Context

Bandhan Bank’s underlying stock price closed at ₹185, just 3.89% shy of its 52-week high of ₹192.48. The stock has outperformed its private sector banking peers by 1.56% on the day and has recorded a consecutive five-day gain, delivering a cumulative return of 9.32% over this period. Intraday, the stock touched a high of ₹190.23, marking a 4.02% rise from the previous close.

Technically, the stock is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a strong bullish trend. This technical strength likely underpins the increased open interest, as traders position themselves for further upside potential.

Market Positioning and Investor Behaviour

Despite the strong price momentum, delivery volumes have declined by 21.59% compared to the five-day average, with 28.05 lakh shares delivered on 25 Feb 2026. This suggests that while short-term trading activity in derivatives is intensifying, longer-term investor participation in the cash segment is moderating. The liquidity profile remains robust, with the stock’s average traded value supporting trade sizes of up to ₹3.34 crores, ensuring ease of entry and exit for institutional players.

The increase in open interest alongside rising prices typically indicates fresh long positions being initiated, reflecting bullish sentiment. However, the simultaneous drop in delivery volumes may imply that some investors are opting for derivatives exposure rather than outright stock purchases, possibly to leverage their directional bets or hedge existing positions.

Mojo Score and Analyst Ratings

Bandhan Bank currently holds a Mojo Score of 51.0, placing it in the 'Hold' category, an upgrade from its previous 'Sell' rating as of 4 Feb 2026. This reflects a cautious but improving outlook from MarketsMOJO analysts, who have noted the stock’s recent price strength and improving fundamentals. The market capitalisation stands at ₹30,157 crores, categorising it as a small-cap within the private sector banking space.

The stock’s day-on-day return of 1.31% significantly outpaces the sector’s decline of 0.30% and the Sensex’s marginal fall of 0.10%, highlighting its relative strength amid broader market weakness.

Implications for Directional Bets

The combination of rising open interest, strong volume, and price appreciation suggests that market participants are increasingly confident in Bandhan Bank’s near-term prospects. The derivatives market activity points to a predominance of bullish bets, with traders likely anticipating further upside driven by improving asset quality, loan growth, or favourable regulatory developments.

However, the reduced delivery volumes caution that some investors may be adopting a more tactical approach, favouring derivatives for leveraged exposure or hedging rather than outright stock accumulation. This nuanced positioning could lead to increased volatility if market conditions shift or if profit-taking emerges near the 52-week high.

Sector and Market Context

Within the private sector banking industry, Bandhan Bank’s recent performance stands out as a relative outperformer. The sector has faced headwinds from rising interest rates and competitive pressures, yet Bandhan Bank’s ability to sustain gains and attract derivative interest suggests investor confidence in its strategic positioning and growth trajectory.

Its market cap grade of 3 indicates moderate size and liquidity, which may appeal to investors seeking exposure to a bank with growth potential but manageable risk. The stock’s proximity to its 52-week high also raises the question of whether the current momentum can be sustained or if profit-taking will emerge in the near term.

Outlook and Investor Considerations

Investors should monitor open interest trends closely as a barometer of market sentiment. Continued increases in OI alongside rising prices would reinforce the bullish narrative, while any sharp declines or divergence could signal caution. Additionally, tracking delivery volumes and volume patterns in both cash and derivatives markets will provide insights into the conviction behind the moves.

Given the current data, Bandhan Bank appears poised for further gains, but investors should remain vigilant for potential volatility near key resistance levels. The upgraded Mojo Grade to 'Hold' suggests a balanced view, recognising both the opportunities and risks inherent in the stock’s current trajectory.

Summary

Bandhan Bank Ltd.’s recent surge in open interest and volume in derivatives, combined with strong price performance and technical strength, indicates a growing bullish sentiment among market participants. While delivery volumes have moderated, the overall positioning suggests fresh long bets and increased speculative interest. The stock’s upgraded Mojo Grade to 'Hold' reflects cautious optimism, with investors advised to watch for confirmation of trend continuation or signs of profit-taking.

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