Open Interest and Volume Dynamics
The latest data reveals that Eternal Ltd’s open interest (OI) in derivatives rose sharply from 1,65,126 contracts to 1,96,062 contracts, an increase of 30,936 contracts or 18.73% on 18 Feb 2026. This surge in OI was accompanied by a robust volume of 1,64,604 contracts traded, indicating active participation from traders and investors in the derivatives market.
In monetary terms, the futures segment alone accounted for a value of approximately ₹2,81,634 lakhs, while the options segment’s value was substantially higher at ₹8,60,81,89,177 lakhs, culminating in a total derivatives value of ₹2,90,682.64 lakhs. This substantial volume and value underpin the growing interest in Eternal Ltd’s derivatives, despite the stock’s recent price weakness.
Price Performance and Technical Indicators
Eternal Ltd’s share price has been under pressure, declining by 2.18% on the day and underperforming its sector by 0.95%. Over the last two consecutive sessions, the stock has lost 3.94%, touching an intraday low of ₹273, down 3.02% from previous levels. The weighted average price of traded volumes skewed closer to the day’s low, signalling selling pressure.
Technically, the stock is trading below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – indicating a sustained downtrend. This technical weakness is compounded by a sharp fall in delivery volumes, which dropped by 45.01% to 1.55 crore shares on 17 Feb compared to the five-day average, suggesting waning investor conviction in holding the stock long-term.
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Market Positioning and Directional Bets
The sharp rise in open interest amid falling prices typically points to fresh short positions being established, or existing shorts being added to, as traders anticipate further downside. The fact that the stock is trading below all major moving averages reinforces this bearish sentiment. Moreover, the decline in delivery volumes suggests that long-term investors are reducing their holdings, possibly in response to deteriorating fundamentals or sector headwinds.
Given Eternal Ltd’s current Mojo Score of 31.0 and a Mojo Grade downgraded from Hold to Sell on 23 Oct 2025, the market’s directional bias appears to be negative. The company’s market cap remains large at ₹2,71,464 crore, but the low Market Cap Grade of 1 indicates limited upside potential relative to its size and sector peers.
Interestingly, the underlying stock price of ₹275 contrasts with the heavy derivatives activity, implying that traders are positioning for volatility or a continuation of the downtrend. The futures value of ₹2,81,634 lakhs and the enormous options value suggest that both hedging and speculative strategies are in play, with a tilt towards bearish bets given the price action.
Sector and Broader Market Context
Within the E-Retail/E-Commerce sector, Eternal Ltd’s performance has lagged, with the sector itself down 1.24% on the day, while the Sensex managed a modest gain of 0.20%. This divergence highlights company-specific challenges or negative sentiment impacting Eternal more than its peers. The sector’s broader weakness may be linked to macroeconomic factors such as consumer spending trends, regulatory changes, or competitive pressures.
Investors should note that Eternal Ltd’s liquidity remains adequate, with the stock capable of supporting trade sizes up to ₹22.01 crore based on 2% of the five-day average traded value. This liquidity ensures that derivatives activity is meaningful and not distorted by thin trading.
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Implications for Investors and Traders
The confluence of rising open interest, falling prices, and declining delivery volumes suggests that Eternal Ltd is currently under bearish pressure in the derivatives market. Traders appear to be increasing short exposure or hedging existing long positions, anticipating further downside or volatility.
For long-term investors, the downgrade to a Sell grade and the weak technical setup warrant caution. The stock’s inability to hold above key moving averages and the lack of strong delivery volume support indicate that the current downtrend may persist unless there is a fundamental catalyst to reverse sentiment.
Conversely, short-term traders might find opportunities in the derivatives market to capitalise on the heightened volatility and directional bets. However, given the large market cap and liquidity, any sharp moves could attract quick reversals, so risk management remains paramount.
Outlook and Conclusion
Eternal Ltd’s recent surge in open interest amid a weakening price trend reflects a market positioning that favours bearish strategies. The stock’s downgrade to Sell and low Mojo Score reinforce the cautious stance investors should adopt. While the E-Retail sector faces headwinds, Eternal’s specific challenges appear to be driving the derivatives market activity.
Investors and traders should closely monitor changes in open interest, volume patterns, and price action to gauge evolving market sentiment. Until there is a clear reversal in technical indicators or an improvement in fundamentals, the prevailing trend suggests continued pressure on Eternal Ltd’s stock price.
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