Robust Call Option Volumes Highlight Investor Optimism
On 30 Jan 2026, Hindustan Zinc Ltd witnessed extraordinary call option activity, particularly for contracts expiring on 24 Feb 2026. The strike prices of ₹700 and ₹750 attracted the highest volumes, with 4,747 and 3,682 contracts traded respectively. This translated into a combined turnover exceeding ₹2,288 lakhs, underscoring strong investor interest in leveraged bullish bets on the stock.
The open interest figures further reinforce this trend, with 3,764 contracts outstanding at the ₹700 strike and 4,937 at ₹750. Given the underlying stock price of ₹679.25, the concentration of activity above the current market price suggests traders are positioning for a meaningful upside in the near term.
Price Action and Technical Context
Despite the bullish options activity, Hindustan Zinc’s share price experienced a challenging session, closing down 5.21% on the day and underperforming the broader Sensex, which declined by 0.48%. The stock opened with a gap down of 3.52% and touched an intraday low of ₹663.25, marking a 7.26% drop from previous levels. Notably, the weighted average traded price skewed closer to the day’s low, indicating selling pressure.
However, the stock remains technically supported above its 20-day, 50-day, 100-day, and 200-day moving averages, though it trades below the 5-day average, signalling short-term weakness amid longer-term strength. This mixed technical picture may explain the divergence between spot price performance and options market optimism.
Sectoral and Market Backdrop
The non-ferrous metals sector, to which Hindustan Zinc belongs, has been under pressure, declining 4.5% on the same day. Against this backdrop, Hindustan Zinc outperformed its sector by 0.69%, reflecting relative resilience. The stock’s large-cap status with a market capitalisation of ₹3,02,364 crores and a Market Cap Grade of 1 further cements its position as a key player in the metals space.
Investor participation has notably increased, with delivery volumes on 29 Jan rising by 102.77% to 1.92 crore shares compared to the five-day average. This surge in physical market activity complements the options market’s bullish undertone, suggesting growing conviction among institutional and retail investors alike.
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Mojo Score Upgrade Reflects Improving Fundamentals
Hindustan Zinc’s recent upgrade from Hold to Buy by MarketsMOJO on 9 Oct 2025, accompanied by a Mojo Score of 71.0, signals enhanced confidence in the company’s growth prospects and valuation appeal. The upgrade reflects improvements across key financial metrics and trend assessments, positioning the stock favourably within the non-ferrous metals sector.
The company’s strong fundamentals, including steady production growth, cost efficiencies, and robust cash flows, underpin this positive outlook. Moreover, the stock’s liquidity profile supports sizeable trade volumes, with an average daily traded value sufficient to accommodate transactions worth ₹52.93 crores without significant market impact.
Options Expiry and Strike Price Dynamics
The concentration of call option activity at the ₹700 and ₹750 strikes for the 24 Feb 2026 expiry is particularly telling. The ₹700 strike, just above the current market price, saw the highest number of contracts traded, indicating a strong bet on the stock crossing this level within the next month. The ₹750 strike, representing a more ambitious target, also attracted substantial interest, suggesting some investors anticipate a sharp rally.
Open interest accumulation at these strikes points to sustained bullish sentiment, as traders hold onto positions expecting upward price movement. This pattern is consistent with a market positioning that anticipates a recovery or positive catalyst in the near term, despite recent price weakness.
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Balancing Short-Term Volatility with Long-Term Potential
While the recent price decline and intraday volatility may raise concerns for some investors, the underlying market signals from options activity and delivery volumes suggest a more nuanced outlook. The stock’s ability to outperform its sector amid a broad metals sell-off highlights its relative strength and investor preference.
Furthermore, the upgrade to a Buy rating and the high Mojo Score reinforce the view that Hindustan Zinc is well-positioned to capitalise on favourable industry dynamics, including rising zinc demand and stable commodity prices. Investors should weigh the short-term price fluctuations against the company’s solid fundamentals and strategic growth initiatives.
Outlook and Investor Considerations
Given the current market environment, investors looking at Hindustan Zinc should monitor the evolution of option open interest and strike price concentrations as leading indicators of market sentiment. The February expiry window will be critical in confirming whether the bullish positioning translates into actual price appreciation.
Additionally, tracking sectoral trends and global commodity price movements will be essential, as these factors heavily influence the company’s earnings and valuation. The stock’s liquidity and large-cap status make it an attractive candidate for both institutional and retail portfolios seeking exposure to the metals sector.
Conclusion
Hindustan Zinc Ltd’s surge in call option activity, particularly at strikes above the current market price, signals a strong bullish bias among market participants despite recent price setbacks. Supported by a recent upgrade to Buy and a robust Mojo Score, the stock demonstrates resilience within a challenging sectoral environment. Investors should consider the interplay of technical, fundamental, and options market data to make informed decisions as the February expiry approaches.
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