Bandhan Bank Sees Sharp Open Interest Surge Signalling Renewed Market Optimism

Open Interest and Volume Dynamics

On 26 Feb 2026, Bandhan Bank’s open interest in derivatives rose sharply by 3,218 contracts, an 11.18% increase from the previous day’s 28,781 to 31,999. This uptick in OI was accompanied by a robust volume of 26,221 contracts, reflecting heightened trading activity. The futures segment alone accounted for a value of approximately ₹43,605 lakhs, while options contributed a substantial ₹13,909 crores, culminating in a total derivatives value of ₹47,768 lakhs.

This surge in open interest, coupled with strong volume, suggests that market participants are actively building positions rather than merely squaring off existing ones. Such a pattern often precedes significant price movements, as fresh capital flows into the stock’s derivatives market.

Price Performance and Technical Indicators

Bandhan Bank’s underlying equity price closed at ₹186, just 2.89% shy of its 52-week high of ₹192.48. The stock has been on a consistent upward trajectory, gaining 10.39% over the past five trading sessions. On the day in question, it outperformed its private sector banking peers by 2.29%, closing with a 2.14% gain compared to the sector’s marginal decline of 0.02% and the Sensex’s 0.06% fall.

Intraday, the stock touched a high of ₹190.23, marking a 4.02% rise from the previous close. Importantly, Bandhan Bank is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a strong bullish trend and positive investor sentiment.

Market Positioning and Investor Behaviour

Despite the strong price gains and derivatives activity, delivery volumes have declined by 21.59% to 28.05 lakh shares on 25 Feb, compared to the five-day average. This indicates a shift in investor behaviour, with traders possibly favouring short-term derivatives exposure over outright equity holdings. The stock’s liquidity remains adequate, with a trade size capacity of ₹3.34 crores based on 2% of the five-day average traded value, ensuring smooth execution of sizeable trades.

The increase in open interest alongside rising prices typically points to fresh long positions being established, reflecting bullish market sentiment. However, the falling delivery volumes could also imply that some investors are adopting a more cautious stance, preferring to hedge or speculate via derivatives rather than committing fully to the underlying stock.

Mojo Score Upgrade and Market Capitalisation

Bandhan Bank currently holds a Mojo Score of 51.0, reflecting a Hold rating, an upgrade from its previous Sell grade as of 4 Feb 2026. This improvement indicates a more balanced outlook on the stock’s near-term prospects, factoring in its recent price momentum and derivatives market activity. The bank’s market capitalisation stands at ₹30,157 crores, categorising it as a small-cap entity within the private sector banking space.

The Mojo Grade upgrade suggests that while the stock is not yet a strong buy, it has moved out of the sell territory, signalling cautious optimism among analysts. The market cap grade of 3 further underscores its mid-tier status, with room for growth as it consolidates gains and attracts further institutional interest.

Potential Directional Bets and Derivatives Strategy

The surge in open interest and volume in Bandhan Bank’s derivatives points to increased directional bets, likely favouring a bullish stance given the stock’s recent price appreciation and technical strength. Traders may be utilising futures contracts to leverage their exposure or options strategies such as buying calls or writing puts to capitalise on anticipated upside moves.

Given the stock’s proximity to its 52-week high and sustained gains over five consecutive sessions, market participants appear confident in continued momentum. However, the decline in delivery volumes suggests some investors remain cautious, possibly hedging positions or awaiting confirmation of a sustained breakout above the ₹192.48 level.

Overall, the derivatives market activity signals a growing conviction in Bandhan Bank’s near-term upside potential, supported by improving fundamentals and positive sectoral trends in private banking.

Sector Context and Comparative Performance

Within the private sector banking industry, Bandhan Bank’s recent outperformance is notable. While the sector has remained largely flat, the bank’s 2.14% gain on the day and 10.39% rise over five sessions highlight its relative strength. This performance is underpinned by improving asset quality, steady loan growth, and a focus on retail and microfinance segments, which have shown resilience amid macroeconomic uncertainties.

Compared to the broader Sensex, which declined by 0.06% on the same day, Bandhan Bank’s gains underscore its appeal as a potential growth stock within the banking universe. Investors and traders are increasingly positioning themselves to benefit from the bank’s upward momentum, as reflected in the derivatives market’s expanding open interest.

Risks and Considerations

Despite the positive signals, investors should remain mindful of certain risks. The decline in delivery volumes may indicate some hesitation among long-term holders, possibly due to valuation concerns or sectoral headwinds such as rising interest rates and regulatory changes. Additionally, the stock’s proximity to its 52-week high could invite profit booking or increased volatility in the near term.

Market participants should monitor open interest trends closely, as a sudden drop or reversal could signal a shift in sentiment. Furthermore, macroeconomic factors and banking sector developments will continue to influence Bandhan Bank’s trajectory, necessitating a balanced approach to position sizing and risk management.

Outlook

Bandhan Bank’s recent surge in derivatives open interest, combined with strong price performance and technical indicators, suggests a constructive near-term outlook. The upgrade to a Hold rating by MarketsMOJO reflects a more favourable assessment, though investors are advised to watch for confirmation of sustained momentum beyond the current resistance levels.

With liquidity adequate for sizeable trades and a growing base of market participants engaging in derivatives, Bandhan Bank is poised to remain a focal point within the private sector banking space. Strategic investors may consider leveraging derivatives to optimise exposure while managing risk amid evolving market conditions.

Limited Period Only. Start at Rs. 9,999 - Get MojoOne for 1 Year + 3 Months FREE (60% Off) Get 71% Off →