Indus Towers Sees Sharp Open Interest Surge Amid Mixed Market Signals

Open Interest and Volume Dynamics

On 23 Jan 2026, Indus Towers Ltd (symbol: INDUSTOWER) recorded an open interest (OI) of 1,01,880 contracts, up from 86,524 contracts the previous session. This increase of 15,356 contracts represents a robust 17.75% jump, indicating a fresh influx of derivative positions. The volume for the day stood at 59,765 contracts, reflecting active trading interest in the stock’s futures and options.

The futures segment alone accounted for a value of approximately ₹2,32,142 lakhs, while the options segment’s notional value was substantially higher at ₹19,76,88,902 lakhs, underscoring the dominance of options in the stock’s derivatives market. The combined derivatives turnover was ₹2,34,150 lakhs, signalling strong liquidity and participation.

Price Movement and Technical Context

Despite the surge in derivatives activity, Indus Towers’ underlying stock price declined by 1.91% to close near ₹411, touching an intraday low of ₹410.2, slightly underperforming the telecom equipment sector which fell 2.32%. The stock remains above its 100-day and 200-day moving averages, suggesting a longer-term support base, but trades below its 5-day, 20-day, and 50-day averages, indicating short-term weakness and possible consolidation.

Investor participation appears to be waning slightly, with delivery volumes on 22 Jan at 48.42 lakh shares, down 0.21% against the five-day average. This decline in delivery volume hints at reduced conviction among long-term holders, even as derivatives traders ramp up activity.

Market Positioning and Directional Bets

The sharp rise in open interest alongside a falling stock price often points to increased short positioning or hedging activity. However, the sizeable volume and elevated options notional value suggest that market participants are actively repositioning, possibly anticipating volatility or a directional move in the near term.

Given the telecom equipment sector’s recent underperformance and Indus Towers’ large-cap status with a market capitalisation of ₹1,08,481.25 crore, institutional investors may be using derivatives to hedge exposure or speculate on a rebound. The stock’s Mojo Score has improved to 67.0 with a Hold rating, upgraded from Sell on 7 Nov 2025, reflecting a cautious but more optimistic outlook from MarketsMOJO analysts.

Sectoral and Broader Market Context

The telecom equipment sector has been under pressure recently, with a 1-day return of -2.30%, slightly worse than the Sensex’s -0.91% decline. Indus Towers’ relative outperformance within the sector, despite a negative day, may be attracting speculative interest in derivatives as traders position for a potential sector recovery or company-specific catalysts.

Liquidity remains adequate, with the stock’s traded value supporting a trade size of approximately ₹7.24 crore based on 2% of the five-day average traded value. This ensures that derivative positions can be entered and exited without significant market impact, encouraging active participation.

Investor Sentiment and Quality Assessment

MarketsMOJO’s grading system currently assigns Indus Towers a Hold rating with a Mojo Grade of 67.0, upgraded from Sell in early November 2025. The market cap grade remains at 1, reflecting its large-cap stature and stable fundamentals. This upgrade signals improved confidence in the company’s medium-term prospects, possibly driven by steady cash flows and strategic positioning in the telecom infrastructure space.

However, the short-term technical indicators and falling delivery volumes suggest caution. Investors should closely monitor open interest trends and volume patterns for confirmation of sustained directional moves.

Outlook and Strategic Considerations

In summary, the pronounced increase in open interest in Indus Towers’ derivatives market reflects a complex interplay of hedging and speculative activity. While the stock’s price has softened in the short term, the underlying technical support and improved analyst sentiment suggest that investors are positioning for a potential recovery or volatility-driven trading opportunities.

Market participants should weigh the implications of rising open interest against the backdrop of sectoral weakness and subdued delivery volumes. The derivatives market activity may presage a directional breakout, but confirmation through price action and volume is essential before committing to significant positions.

Given the stock’s liquidity and large-cap status, Indus Towers remains a key bellwether within the telecom equipment industry, and its derivatives market trends offer valuable insights into institutional sentiment and market expectations.

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