Coal India Ltd Sees Robust Call Option Activity Amid Bullish Momentum

Robust Call Option Activity Highlights Investor Optimism

The call options for Coal India Ltd. (COALINDIA) with a strike price of ₹440 and expiry on 24 February 2026 witnessed an impressive 5,153 contracts traded, generating a turnover of ₹637.22 lakhs. Open interest stands at 3,446 contracts, indicating strong ongoing interest and positioning by market participants. The underlying stock price is currently ₹439.90, hovering just below the strike price, which suggests that traders are anticipating a breakout above this level in the near term.

This surge in call option activity is a clear signal of bullish positioning, as investors seek leveraged exposure to potential upside in Coal India’s shares. The concentration of trades at the ₹440 strike price, close to the current market price, points to expectations of a rally in the coming weeks, particularly ahead of the February expiry.

Price Performance and Technical Strength

Coal India Ltd. has outperformed its sector peers, gaining 1.87% on the day and outperforming the Minerals & Mining sector by 0.29%. Over the past three consecutive trading sessions, the stock has delivered a cumulative return of 4.53%, underscoring sustained buying interest. Intraday, the stock touched a high of ₹441.40, marking a 2.79% increase from the previous close.

Technically, Coal India is trading above all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a strong uptrend. This alignment of moving averages often attracts momentum traders and institutional investors, reinforcing the bullish case. The stock’s liquidity is robust, with a delivery volume of 77.32 lakh shares on 3 February, reflecting a 9.45% increase over the five-day average delivery volume, which supports sustained investor participation.

Sectoral Context and Dividend Appeal

The Minerals & Mining sector has gained 2.32% recently, buoyed by improving commodity prices and positive demand outlooks. Coal India’s market capitalisation stands at a substantial ₹2,65,151 crore, categorising it as a large-cap stock with significant institutional interest. The company offers a high dividend yield of 4.87%, which adds to its appeal for income-focused investors amid volatile markets.

Mojo Score and Rating Update

MarketsMOJO assigns Coal India Ltd. a Mojo Score of 67.0, reflecting a Hold rating, which was downgraded from a Buy on 1 February 2026. This adjustment reflects a more cautious stance amid recent market volatility and valuation considerations. The Market Cap Grade remains at 1, indicating the company’s large-cap status and stable market presence. Despite the Hold rating, the stock’s technical and options market activity suggests that traders are positioning for potential near-term gains.

Expiry Patterns and Strike Price Concentration

The expiry date of 24 February 2026 is attracting significant open interest, with the ₹440 strike price being the focal point for call option traders. This concentration suggests that investors are targeting a breakout above this level within the next three weeks. The open interest of 3,446 contracts at this strike price is substantial, indicating that many traders are either initiating or rolling over bullish positions.

Such expiry patterns often precede volatility spikes as traders adjust their positions. The high turnover of ₹637.22 lakhs in call options further confirms active participation and confidence in upward price movement. This activity is consistent with the stock’s recent outperformance relative to the Sensex, which gained only 0.23% on the same day.

Comparative Sector and Market Analysis

While Coal India has outperformed the sector’s 2.01% one-day return with a 2.27% gain, the broader Sensex’s modest 0.23% rise highlights the stock’s relative strength. The Minerals & Mining sector’s 2.32% gain provides a supportive backdrop, driven by improving commodity demand and supply-side dynamics. Investors looking for exposure to this sector may find Coal India’s combination of dividend yield, liquidity, and technical momentum attractive despite the Hold rating.

Investor Implications and Outlook

For investors, the heightened call option activity in Coal India Ltd. signals a growing consensus on potential price appreciation in the near term. The stock’s technical strength, combined with improving sector fundamentals and a healthy dividend yield, makes it a compelling candidate for both momentum and income-oriented portfolios.

However, the recent downgrade to a Hold rating by MarketsMOJO suggests caution, particularly given valuation levels and broader market uncertainties. Investors should monitor the stock’s ability to sustain gains above the ₹440 level, as well as sectoral developments and commodity price trends that could influence Coal India’s performance.

Overall, the options market activity provides a valuable barometer of sentiment, indicating that traders are positioning for a positive outcome in the weeks ahead, with the February expiry serving as a key milestone.

Summary

Coal India Ltd. stands out as a focal point of bullish call option activity, with significant contracts traded at the ₹440 strike price expiring on 24 February 2026. The stock’s recent price gains, technical positioning above key moving averages, and sector outperformance underpin this optimism. While the Mojo Score downgrade to Hold advises prudence, the combination of liquidity, dividend yield, and investor interest in options markets suggests that Coal India remains a stock to watch closely in the minerals and mining space.

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