Hindustan Zinc Ltd Sees Surge in Call Option Activity Ahead of January Expiry

Strong Price Performance and Market Position

Hindustan Zinc Ltd, a leading player in the Non-Ferrous Metals sector, has been on an upward trajectory, hitting a new 52-week high of ₹696.95 on 21 January 2026. The stock has gained 8.67% over the past three consecutive trading sessions, reflecting robust investor confidence. On the day, it recorded a 2.29% increase, outperforming the Sensex which declined marginally by 0.08%. The stock’s market capitalisation stands at a substantial ₹2,93,511.78 crores, categorising it firmly as a large-cap entity.

Technical indicators reinforce this positive momentum, with Hindustan Zinc trading above its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. This alignment across multiple timeframes suggests sustained buying interest and a favourable trend outlook. Additionally, delivery volumes surged to 89.91 lakh shares on 20 January, marking a 112.39% increase compared to the five-day average, indicating rising investor participation and conviction.

Call Option Activity Highlights Bullish Positioning

The derivatives market data reveals that call options on Hindustan Zinc are attracting significant attention, particularly for the 27 January 2026 expiry. The most actively traded call options are clustered around strike prices of ₹690, ₹700, and ₹710, all above the current underlying value of ₹695.45, underscoring a bullish outlook.

Specifically, the ₹700 strike call option leads with 12,919 contracts traded, generating a turnover of ₹2,253.59 lakhs and an open interest of 6,354 contracts. This is closely followed by the ₹690 strike call with 7,707 contracts traded, turnover of ₹1,638.97 lakhs, and open interest of 3,136 contracts. The ₹710 strike call also shows substantial activity with 6,443 contracts traded, turnover of ₹842.94 lakhs, and open interest of 3,740 contracts.

The concentration of open interest at these strike prices suggests that market participants are positioning for a potential upward move beyond the current price level. The high turnover and contract volumes indicate active hedging and speculative interest, reflecting confidence in further price appreciation before the expiry date.

Mojo Score Upgrade Reflects Improving Fundamentals

MarketsMOJO’s latest assessment upgraded Hindustan Zinc’s Mojo Grade from Hold to Buy on 9 October 2025, reflecting an improved score of 71.0. This upgrade is supported by the company’s strong market cap grade of 1, indicating its large-cap status and robust market presence. The rating upgrade signals enhanced confidence in the company’s fundamentals, growth prospects, and sector positioning.

Hindustan Zinc’s performance is in line with the broader Non-Ferrous Metals sector, which recorded a 2.19% gain on the same day, slightly outperforming the stock’s 2.04% one-day return. This sectoral strength, combined with the company’s individual momentum, provides a solid backdrop for continued investor interest.

Expiry Patterns and Investor Sentiment

The expiry date of 27 January 2026 is drawing significant attention, with call option volumes peaking as traders position themselves ahead of this key date. The clustering of open interest at strike prices above the current market price suggests a consensus expectation of upward price movement. This pattern is typical of bullish sentiment, where investors seek to capitalise on anticipated gains by purchasing call options at or above the money.

Moreover, the liquidity profile of Hindustan Zinc supports sizeable trade executions, with the stock’s average traded value allowing for trade sizes up to ₹31.13 crores based on 2% of the five-day average. This liquidity ensures that both institutional and retail investors can enter or exit positions with relative ease, further encouraging active participation in both the cash and derivatives markets.

Balancing Risks and Opportunities

While the bullish call option activity and positive price trends are encouraging, investors should remain mindful of potential volatility around the expiry date. The Non-Ferrous Metals sector is subject to commodity price fluctuations, regulatory changes, and global demand-supply dynamics, which can impact stock performance.

Hindustan Zinc’s strong fundamentals and market leadership provide a cushion against sector headwinds, but prudent risk management remains essential. The elevated open interest in call options at strike prices above the current market price may also lead to increased gamma and delta hedging activities by market makers, potentially amplifying price swings in the short term.

Outlook and Investor Takeaways

Overall, Hindustan Zinc Ltd presents a compelling case for bullish positioning, supported by solid price momentum, upgraded fundamental ratings, and active call option trading. The concentration of call option interest at strikes of ₹690, ₹700, and ₹710 ahead of the 27 January expiry indicates market expectations of further upside potential.

Investors looking to capitalise on this momentum should consider the stock’s liquidity, sector dynamics, and technical indicators. The recent upgrade to a Buy rating by MarketsMOJO adds further validation to the positive outlook, making Hindustan Zinc a noteworthy candidate for portfolios seeking exposure to the Non-Ferrous Metals space.

As always, a balanced approach incorporating fundamental analysis, technical signals, and market sentiment will be key to navigating the evolving landscape around this large-cap metal producer.

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