Bharat Electronics Ltd Sees Robust Call Option Activity Ahead of February Expiry

Robust Call Option Volumes Signal Bullish Sentiment

Data from the options market reveals that Bharat Electronics Ltd has emerged as the most active stock in call options trading, particularly for contracts expiring on 24 February 2026. The underlying stock closed at ₹441.7 on 29 January 2026, just 3.45% shy of its 52-week high of ₹457.5, signalling strong price momentum.

Among the most actively traded call options, the 460 strike price leads with 7,293 contracts traded, generating a turnover of ₹1,406.11 lakhs and an open interest of 5,547 contracts. Close behind is the 450 strike call with 7,081 contracts traded and a turnover of ₹1,730.51 lakhs, reflecting substantial investor interest at slightly out-of-the-money levels.

Other notable strike prices include 480 with 6,631 contracts traded (turnover ₹745.54 lakhs, open interest 5,030) and 470 with 6,262 contracts traded (turnover ₹912.86 lakhs, open interest 3,994). The 455 strike also saw 4,223 contracts traded, contributing ₹951.41 lakhs in turnover.

This clustering of call option activity at strike prices ranging from 450 to 480 indicates a strong bullish positioning by traders anticipating upward price movement in BEL over the coming weeks.

Underlying Stock Performance and Technical Indicators

Despite a day’s decline of 2.57%, Bharat Electronics outperformed its sector, which fell by 2.16%, and the broader Sensex, which declined by 0.48%. The stock’s resilience is further underscored by its trading above all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling sustained positive momentum.

Investor participation has surged notably, with delivery volumes on 28 January reaching 3.49 crore shares, a 204.36% increase over the five-day average. This heightened activity reflects growing conviction among market participants, potentially driven by the recent upgrade in BEL’s Mojo Grade from Hold to Buy on 17 November 2025, accompanied by a strong Mojo Score of 78.0.

Sector Context and Market Capitalisation

Bharat Electronics Ltd operates within the Aerospace & Defense industry, a sector currently experiencing mixed trends. While the defence sector has seen a decline of 2.16% on the day, BEL’s relative outperformance highlights its defensive qualities and investor preference amid broader market volatility.

With a market capitalisation of ₹3,31,425 crore, BEL is classified as a large-cap stock, offering liquidity and stability to investors. The stock’s market cap grade of 1 further confirms its standing as a heavyweight in the sector, making it a preferred choice for institutional and retail investors alike.

Options Expiry Patterns and Investor Positioning

The expiry date of 24 February 2026 is attracting significant open interest, with the 450 and 460 strike calls holding the highest open interest at 5,673 and 5,547 contracts respectively. This concentration suggests that traders are positioning for a potential breakout above these levels in the near term.

Open interest at the 480 strike price is also substantial at 5,030 contracts, indicating expectations of further upside beyond the current price. The turnover figures, particularly the ₹1,730.51 lakhs at the 450 strike, reflect active trading and liquidity in these strikes, enabling investors to build or unwind positions efficiently.

Such elevated call option activity, especially at strikes above the current underlying price, is a classic indicator of bullish sentiment. Market participants appear confident in BEL’s prospects, possibly anticipating positive developments in defence contracts, government spending, or favourable earnings outcomes.

Implications for Investors and Outlook

For investors, the surge in call option volumes at multiple strike prices above the current market price signals a growing consensus on BEL’s upside potential. The stock’s technical strength, combined with increased delivery volumes and a recent upgrade to a Buy rating, provides a compelling case for bullish positioning.

However, the stock did experience a minor pullback on 29 January, falling 1.84% intraday and touching a low of ₹442, which is a 2.43% dip from the previous close. This short-term correction after two consecutive days of gains may offer a tactical entry point for investors looking to capitalise on the stock’s longer-term uptrend.

Given the Aerospace & Defense sector’s strategic importance and BEL’s dominant market position, the company is well placed to benefit from increased government defence spending and export opportunities. The stock’s liquidity, with the capacity to handle trade sizes of approximately ₹25.49 crore based on recent averages, further supports active trading and institutional interest.

Investors should monitor the upcoming earnings announcements and government policy updates closely, as these could act as catalysts for further price appreciation. The options market activity suggests that many traders are already factoring in positive developments, making it essential to stay informed and agile.

Conclusion

Bharat Electronics Ltd’s pronounced call option activity ahead of the 24 February expiry highlights a strong bullish sentiment among market participants. With significant open interest and turnover concentrated at strike prices between ₹450 and ₹480, investors are positioning for a potential rally in this large-cap Aerospace & Defense stock. Supported by robust technical indicators, increased delivery volumes, and a recent upgrade to a Buy rating, BEL remains an attractive proposition for those seeking exposure to the defence sector’s growth trajectory.

While short-term volatility cannot be ruled out, the overall market signals point towards sustained investor confidence and upside potential in Bharat Electronics Ltd over the coming months.

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