Hindalco Industries Sees Surge in Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights

On 8 January 2026, Hindalco’s put options with a strike price of ₹900 and expiry date 27 January 2026 emerged as the most actively traded contracts. A total of 2,573 contracts changed hands, generating a turnover of approximately ₹210.55 lakhs. The open interest for these puts stands at 1,970 contracts, indicating sustained interest and potential build-up of bearish bets or protective hedges.

The underlying stock price hovered near ₹919.95, just above the ₹900 strike, suggesting that traders are positioning for a possible downside or increased volatility in the near term. This activity is particularly significant given the stock’s recent price action and sectoral trends.

Recent Price Performance and Technical Context

Hindalco Industries has been under pressure for the last two trading days, registering a cumulative decline of 2.37%. On 8 January, the stock touched an intraday low of ₹918.5, down 2.13% from the previous close. This underperformance is in line with the Aluminium & Aluminium Products sector, which fell by 2.66% on the same day, reflecting broader sectoral weakness.

Despite the short-term dip, Hindalco remains technically resilient, trading above its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. This suggests that while immediate sentiment is cautious, the medium to long-term trend remains intact, supported by steady fundamentals and investor confidence.

Sectoral and Market Context

The Non-Ferrous Metals sector, particularly aluminium producers, has faced headwinds due to global commodity price fluctuations and demand concerns. Hindalco’s market cap stands at a robust ₹2,06,823.49 crores, categorising it as a large-cap stock with significant institutional participation. The stock’s Mojo Score of 78.0 and a current Mojo Grade of Buy (downgraded from Strong Buy on 18 November 2025) reflect a cautious but positive outlook from MarketsMOJO’s analytical framework.

Investor participation has notably increased, with delivery volumes rising to 47.49 lakhs on 7 January, a 73.62% jump compared to the five-day average. This heightened activity underscores growing interest and possibly repositioning ahead of the January expiry.

Investor Sentiment and Hedging Strategies

The surge in put option volumes at the ₹900 strike price suggests that market participants are either hedging existing long positions or speculating on a near-term correction. Given the stock’s current price just above this strike, these puts offer a strategic downside protection level for investors wary of further declines.

Open interest data corroborates this view, with nearly 2,000 contracts outstanding, signalling that the bearish positioning is not merely speculative but backed by significant capital commitment. This pattern is consistent with a cautious market stance amid sectoral volatility and global economic uncertainties impacting commodity prices.

Comparative Performance and Liquidity

Hindalco’s one-day return of -1.93% slightly outpaced the Sensex’s marginal decline of -0.17%, but was marginally better than the sector’s fall of -2.30%. This relative performance indicates that while the stock is affected by sectoral pressures, it is holding up better than some peers.

Liquidity remains robust, with the stock’s traded value supporting a trade size of approximately ₹11.96 crores based on 2% of the five-day average traded value. This ensures that investors can enter or exit positions with relative ease, an important consideration given the active options market.

Outlook and Analyst Perspectives

MarketsMOJO’s downgrade of Hindalco’s Mojo Grade from Strong Buy to Buy on 18 November 2025 reflects a tempered optimism. The company retains strong fundamentals and a large market capitalisation, but near-term risks from commodity price volatility and sectoral headwinds have moderated the outlook.

Investors should monitor the January expiry closely, as the concentration of put option activity at ₹900 may act as a key support level. A breach below this strike could trigger further downside, while a rebound above current moving averages would reinforce the stock’s medium-term bullish trend.

Conclusion: Strategic Positioning Ahead of Expiry

Hindalco Industries’ active put option trading ahead of the 27 January 2026 expiry highlights a market bracing for potential downside or volatility in the near term. While the stock’s technicals remain sound, the increased bearish positioning suggests investors are hedging against sectoral uncertainties and global commodity price risks.

For investors, the ₹900 strike price emerges as a critical level to watch. Maintaining positions above this threshold could signal resilience, whereas a decisive break might prompt further caution. Given the stock’s large-cap status, liquidity, and steady fundamentals, it remains a key bellwether for the Non-Ferrous Metals sector’s trajectory in the coming weeks.

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