Eternal Ltd Sees Heavy Call Option Activity Ahead of December Expiry

Call Option Activity Highlights

Data from the options market reveals that Eternal Ltd's call options with a strike price of ₹300 and expiry on 30 December 2025 have emerged as the most actively traded contracts. A total of 3,373 contracts exchanged hands, generating a turnover of approximately ₹477.68 lakhs. The open interest for these contracts stands at 3,467, indicating a substantial build-up of positions ahead of the expiry date.

This level of activity suggests that market participants are closely monitoring Eternal’s price trajectory, with a notable concentration of volume near the ₹300 strike price. Given the underlying stock value of ₹291.45, the strike price represents a modest premium, signalling expectations of upward price movement or hedging strategies by traders.

Price and Volume Context

On the trading day under review, Eternal Ltd’s stock price showed a marginal decline of 0.24%, closing at ₹291.45. This performance was in line with the broader E-Retail sector, which recorded a 0.24% gain, while the Sensex index experienced a slight dip of 0.21%. The stock’s market capitalisation remains robust at ₹2,82,364 crores, categorising it firmly within the large-cap segment.

Technical indicators present a nuanced picture. The weighted average price of traded shares skewed closer to the lower end of the day’s price range, suggesting cautious trading sentiment. Moreover, the stock’s price is positioned above its 200-day moving average but remains below its 5-day, 20-day, 50-day, and 100-day moving averages. This pattern may reflect short-term resistance levels despite longer-term support.

Investor participation has shown signs of moderation. Delivery volumes on 5 December amounted to ₹1.1 crore but declined by 24.34% compared to the five-day average delivery volume. Despite this, liquidity remains adequate, with the stock able to accommodate trade sizes up to ₹13.55 crore based on 2% of the five-day average traded value.

Investor Positioning and Market Sentiment

The concentration of call option contracts at the ₹300 strike price, combined with the open interest figures, indicates a predominantly bullish stance among options traders. This positioning suggests that investors anticipate the stock price to approach or surpass this level by the end of December. However, the current underlying price remains below this strike, implying that the market is factoring in potential upside catalysts or volatility in the near term.

It is also notable that the stock has not recorded any consecutive days of decline recently, with zero days of continuous fall and no negative returns over the observed period. This stability may be encouraging traders to take positions in call options as a leveraged means to benefit from anticipated price appreciation.

From a technical perspective, the stock’s placement above the 200-day moving average provides a degree of long-term support, even as shorter-term averages suggest some resistance. This mixed technical backdrop may be contributing to the cautious yet optimistic sentiment reflected in the options market.

Sector and Market Comparisons

Within the E-Retail and E-Commerce sector, Eternal Ltd’s activity stands out due to its liquidity and market capitalisation. The sector’s overall performance on the day was positive, contrasting with the stock’s slight dip. This divergence may be influencing option traders to hedge or speculate on a rebound, as the sector’s momentum could potentially lift individual stocks like Eternal.

Comparing the stock’s liquidity metrics to its peers, Eternal demonstrates sufficient depth to support sizeable trades without significant price impact. This is an important consideration for institutional investors and large traders who often utilise options to manage risk or enhance returns.

Expiry Patterns and Strategic Implications

The 30 December 2025 expiry date is a key focal point for traders, as it marks the end of the calendar year and often coincides with portfolio rebalancing and tax planning activities. The heavy call option volume at the ₹300 strike price may reflect strategic positioning ahead of this expiry, with investors seeking to capitalise on expected year-end developments or corporate announcements.

Options trading at this strike price also provides a leveraged exposure to potential price movements, allowing traders to benefit from upward shifts without committing to outright stock purchases. This can be particularly attractive in a sector characterised by rapid changes and evolving consumer trends.

Given the stock’s current valuation and technical indicators, the call option activity suggests a market consensus that Eternal Ltd could experience positive momentum in the coming weeks. However, the presence of resistance at shorter-term moving averages and the recent dip in delivery volumes indicate that caution remains warranted.

Conclusion

Eternal Ltd’s prominence in the call options market ahead of the December expiry highlights the stock’s significance within the E-Retail and E-Commerce sector. The concentration of contracts at the ₹300 strike price, combined with substantial open interest and turnover, points to a predominantly bullish sentiment among derivatives traders. While the underlying stock price has shown modest fluctuations and technical resistance, the options market activity suggests anticipation of upward price movement or strategic hedging.

Investors and market participants should continue to monitor price trends, volume patterns, and sector developments as the expiry date approaches. The interplay between technical indicators and options positioning will likely provide further insights into Eternal Ltd’s near-term prospects and investor confidence.

As always, a balanced approach considering both fundamental and technical factors will be essential for navigating the evolving landscape of this large-cap E-Retail stock.

Get 1 year of Weekly Picks FREE when you subscribe to MojoOne. Offer ends soon. Start Saving Now →