Robust Call Option Volumes Signal Bullish Sentiment
On 29 January 2026, Hindustan Zinc’s call options with a strike price of ₹720 expiring on 24 February 2026 recorded an impressive 5,959 contracts traded. This translated into a turnover of approximately ₹2,827.2 lakhs, underscoring heightened speculative and hedging interest in the stock. The open interest at this strike stands at 3,011 contracts, indicating sustained investor commitment to bullish bets as the expiry approaches.
The underlying stock closed at ₹713.15, just 2.8% shy of its 52-week high of ₹733, suggesting that the ₹720 strike is a critical level for market participants. The proximity to the all-time high combined with elevated call option activity points to expectations of a potential breakout or at least a consolidation near peak levels.
Price and Volume Dynamics Underpinning Option Activity
Despite the call option surge, Hindustan Zinc’s stock price underperformed its sector on the day, delivering a 0.70% gain compared to the Non-Ferrous Metals sector’s 2.81% advance. The Sensex, by contrast, declined 0.56%, highlighting the sector’s relative strength. The stock’s underperformance against its sector may reflect profit-booking or cautious positioning ahead of the February expiry.
Notably, the stock is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a strong uptrend. This technical backdrop supports the bullish sentiment seen in options markets. Additionally, delivery volumes surged to 1.13 crore shares on 28 January, a 27.99% increase over the five-day average, indicating rising investor participation and confidence in the stock’s near-term prospects.
Market Capitalisation and Quality Metrics
Hindustan Zinc is a large-cap heavyweight with a market capitalisation of ₹3,00,272 crores, operating in the Non-Ferrous Metals industry. The company’s Mojo Score stands at 71.0, reflecting a strong Buy rating, upgraded from Hold on 9 October 2025. This upgrade was driven by improved fundamentals and positive technical trends, reinforcing the stock’s appeal to institutional and retail investors alike.
The stock’s market cap grade is rated 1, indicating top-tier liquidity and market presence. Based on 2% of the five-day average traded value, Hindustan Zinc can comfortably accommodate trade sizes up to ₹45.8 crores without significant price impact, making it an attractive option for large traders and funds.
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Expiry Patterns and Strike Price Significance
The February 24 expiry is attracting concentrated interest in Hindustan Zinc’s ₹720 call options, a strike price that is slightly out-of-the-money relative to the current underlying price. This suggests traders are positioning for a potential upward move beyond this level in the coming weeks. The open interest of 3,011 contracts at this strike is among the highest for the stock, indicating a consensus around this price target.
Such activity often precedes volatility spikes as expiry approaches, with traders either rolling positions forward or closing out depending on price action. The liquidity and volume in these options provide ample opportunity for both directional bets and hedging strategies.
Sectoral Context and Comparative Performance
The Non-Ferrous Metals sector has gained 3.36% recently, buoyed by strong demand fundamentals and favourable commodity price trends. Hindustan Zinc’s relative underperformance on the day may be a short-term phenomenon, as the stock remains well-positioned within the sector’s uptrend. Its strong technicals and upgraded Mojo Grade to Buy reinforce the likelihood of catching up with or outperforming peers in the near term.
Investors should monitor the stock’s price action around the ₹720 strike and the evolving open interest to gauge market conviction. The combination of rising delivery volumes and sustained call option interest points to a healthy investor appetite for Hindustan Zinc’s shares.
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Investor Implications and Outlook
For investors and traders, the surge in call option activity at the ₹720 strike price ahead of the 24 February expiry offers a clear signal of bullish sentiment. The stock’s technical strength, combined with its upgraded Mojo Grade and strong market capitalisation, supports a positive outlook.
However, the slight underperformance relative to the sector and the broader market’s mixed signals warrant cautious optimism. Investors should consider monitoring open interest trends and price movements closely, especially as expiry nears, to adjust positions accordingly.
Given the stock’s liquidity and rising delivery volumes, Hindustan Zinc remains a viable candidate for both medium-term accumulation and tactical trading strategies centred around options expiry cycles.
Summary
Hindustan Zinc Ltd’s recent call option activity highlights a growing bullish consensus among market participants. The ₹720 strike price for the 24 February 2026 expiry is a focal point, with nearly 6,000 contracts traded and strong open interest. Despite a modest underperformance on the day, the stock’s technical indicators and upgraded Mojo Grade to Buy underpin a constructive outlook. Investors should watch for price action around key levels and evolving option market dynamics to capitalise on potential upside opportunities.
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