Indus Towers Sees Sharp Open Interest Surge Amid Mixed Market Signals

Open Interest and Volume Dynamics

On 23 January 2026, Indus Towers recorded an open interest of 1,03,741 contracts, up from 86,524 the previous day, marking an increase of 17,217 contracts or 19.9%. This rise in OI was accompanied by a futures volume of 68,747 contracts, reflecting robust trading activity. The futures value stood at approximately ₹2,69,134.78 lakhs, while the options segment exhibited an enormous notional value of ₹22,432.60 crores, culminating in a total derivatives value of ₹2,71,394.56 lakhs.

Such a pronounced increase in open interest, especially when paired with elevated volume, often indicates fresh positions being established rather than existing ones being squared off. This suggests that traders are actively repositioning themselves, potentially anticipating a directional move in the underlying stock.

Price Action and Market Context

Despite the surge in derivatives activity, Indus Towers’ stock price declined by 1.66% on the day, closing near ₹412 after touching an intraday low of ₹410, a drop of 2.19%. This underperformance contrasts with the broader telecom equipment sector, which fell by 2.08%, and the Sensex, which declined by 0.77%. Notably, Indus Towers outperformed its sector by 0.42%, indicating relative resilience amid sector-wide weakness.

The stock’s moving averages present a mixed technical picture. It trades above its 100-day and 200-day moving averages, signalling long-term support, but remains below the 5-day, 20-day, and 50-day averages, reflecting short-term selling pressure. This divergence suggests that while the stock retains underlying strength, near-term momentum is subdued.

Investor Participation and Liquidity

Delivery volumes on 22 January stood at 48.42 lakh shares, marginally down by 0.21% compared to the five-day average, indicating a slight dip in investor participation. However, 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 level of liquidity ensures that institutional and retail investors can transact sizeable volumes without significant price impact.

Market Positioning and Directional Bets

The sharp rise in open interest, coupled with steady volume, points to increased speculative interest in Indus Towers’ derivatives. Traders appear to be taking fresh positions, possibly anticipating volatility or a directional move. Given the stock’s recent underperformance relative to its short-term moving averages, some market participants may be positioning for a potential rebound, while others could be hedging against further downside.

Options data, with a notional value exceeding ₹22,000 crore, suggests significant activity in both calls and puts, indicating a balanced but cautious stance among investors. This mixed positioning aligns with the stock’s current Mojo Grade of Hold, upgraded from Sell on 7 November 2025, reflecting a neutral outlook amid uncertain near-term catalysts.

Fundamental and Sectoral Considerations

Indus Towers operates within the Telecom - Equipment & Accessories industry, a sector currently facing headwinds due to subdued capex cycles and competitive pressures. The company’s large market capitalisation of ₹1,08,850.60 crore classifies it as a large-cap stock, which typically attracts institutional interest and offers relative stability.

Its Mojo Score of 67.0 and a Market Cap Grade of 1 further underline its standing as a solid, though not aggressively favoured, investment. The recent upgrade in Mojo Grade from Sell to Hold suggests improving fundamentals or valuation support, but the stock remains under watch for clearer directional cues.

Technical Outlook and Investor Implications

Technically, the stock’s position above long-term moving averages provides a foundation for potential upside, but the short-term weakness and falling investor participation caution against aggressive bullish bets. The surge in open interest may be signalling an impending breakout or breakdown, making it imperative for investors to monitor price action closely over the coming sessions.

For traders, the elevated derivatives activity offers opportunities to capitalise on volatility through strategic option plays or futures positions. However, given the mixed signals, a balanced approach with risk management is advisable.

Conclusion

Indus Towers Ltd’s recent surge in open interest and sustained volume activity in derivatives markets highlights a phase of active repositioning by investors. While the stock’s price has shown some weakness in the short term, its relative outperformance against the sector and support from long-term moving averages provide a cautiously optimistic backdrop.

Investors should weigh the mixed technical signals and evolving market positioning carefully, considering the company’s Hold rating and improving Mojo Grade. Monitoring open interest trends alongside price action will be crucial to gauge the stock’s next directional move within the telecom equipment space.

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