Open Interest and Volume Dynamics
On 23 Feb 2026, Eternal Ltd’s open interest in futures and options contracts rose sharply to 181,659 from the previous 159,411, marking an increase of 22,248 contracts or 13.96%. This notable expansion in OI indicates that new positions are being added rather than existing ones being squared off, reflecting increased conviction among market participants.
Volume data corroborates this trend, with a daily volume of 124,561 contracts traded, underscoring active participation in the derivatives market. The futures segment alone accounted for a value of approximately ₹3,29,200 lakhs, while the options segment’s notional value was substantially higher at ₹50,042,712,516 lakhs, highlighting the dominance of options in the stock’s derivatives trading.
Despite this surge in derivatives activity, the underlying stock price has been under pressure, trading at ₹266 and falling below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a bearish technical setup. The stock has declined by 0.95% on the day, marginally outperforming its sector’s 1.22% fall but lagging behind the Sensex’s 0.44% gain.
Price Performance and Investor Sentiment
Eternal Ltd has been on a losing streak, with the stock falling for five consecutive sessions and delivering a cumulative negative return of 6.84% over this period. This sustained decline has coincided with a sharp drop in delivery volumes, which fell by 33.41% to 1.22 crore shares on 20 Feb compared to the five-day average, indicating waning investor participation in the cash market.
Liquidity remains adequate, with the stock’s average traded value supporting trade sizes up to ₹16.37 crore, ensuring that institutional and retail investors can transact without significant market impact. However, the falling delivery volumes suggest that investors may be increasingly reluctant to hold the stock outright, preferring to express views through derivatives.
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Market Positioning and Directional Bets
The sharp increase in open interest amid falling prices suggests that traders are actively positioning for further downside or hedging existing long exposures. The combination of rising OI and declining price typically signals fresh short positions being established, reflecting bearish sentiment.
Options market data, with its massive notional value, indicates that market participants are likely employing complex strategies such as protective puts or outright bearish bets through put buying and call writing. The elevated futures value also points to increased speculative or hedging activity.
Given Eternal Ltd’s Mojo Score of 31.0 and a recent downgrade from Hold to Sell on 23 Oct 2025, the market’s cautious stance is consistent with fundamental assessments. The company’s Market Cap Grade of 1 further emphasises the stock’s current weak valuation metrics relative to peers.
Sector and Benchmark Comparison
Within the E-Retail and E-Commerce sector, Eternal Ltd’s performance has been lacklustre, underperforming the broader Sensex index which posted a modest gain of 0.44% on the same day. The sector itself declined by 1.22%, indicating sector-wide pressures possibly stemming from macroeconomic concerns or competitive challenges.
The stock’s underperformance relative to its sector peers and the benchmark index highlights the need for investors to carefully assess risk-reward dynamics before committing capital. The persistent downtrend and deteriorating technical indicators suggest that the stock may face further headwinds in the near term.
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Implications for Investors
For investors and traders, the current surge in open interest combined with falling prices and weak delivery volumes signals caution. The derivatives market activity suggests that participants are either hedging against further declines or speculating on continued weakness.
Given the stock’s technical positioning below all major moving averages and the downgrade to a Sell rating, investors should consider risk management strategies and possibly look for confirmation of a trend reversal before increasing exposure.
Those with existing long positions may benefit from protective options strategies, while contrarian investors might wait for signs of stabilisation or improved fundamentals before initiating fresh buys.
Outlook and Conclusion
Eternal Ltd’s recent open interest surge in derivatives markets reflects a complex interplay of bearish sentiment and active positioning. While the stock remains under pressure technically and fundamentally, the heightened derivatives activity offers insights into market expectations and potential volatility ahead.
Investors should monitor upcoming earnings, sector developments, and broader market trends closely, as these factors will influence the stock’s trajectory. Until then, the cautious stance reflected in the derivatives market and the downgrade to Sell rating suggest a prudent approach is warranted.
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