Indus Towers Sees Significant Open Interest Surge Amid Bullish Market Positioning

Open Interest and Volume Dynamics

On 29 Dec 2025, Indus Towers (symbol: INDUSTOWER) recorded an open interest (OI) of 86,559 contracts, up from 76,289 the previous day, marking a substantial increase of 10,270 contracts or 13.46%. This rise in OI is accompanied by a daily volume of 44,452 contracts, indicating active participation in the derivatives market. The futures segment alone accounted for a notional value of approximately ₹1,52,927 lakhs, while the options segment's value was significantly higher at ₹17,041.8 crores, culminating in a total derivatives value exceeding ₹1,54,501 lakhs.

Such a pronounced increase in open interest alongside healthy volume typically signals that new positions are being established rather than existing ones being squared off. This often reflects growing conviction among traders about the stock’s near-term price trajectory.

Price Performance and Technical Context

Indus Towers closed at ₹423, just 1.63% shy of its 52-week high of ₹430, underscoring its strong price momentum. The stock outperformed its sector by 0.4% on the day, delivering a 0.70% gain compared to the Telecom - Equipment & Accessories sector’s 0.46% rise and the broader Sensex’s decline of 0.32%. Notably, the stock is trading above all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — which is a bullish technical indicator suggesting sustained upward momentum.

However, investor participation on the delivery front has waned, with delivery volumes on 26 Dec falling by 67.88% compared to the 5-day average, registering 11.84 lakh shares. This decline in delivery volume may indicate that short-term traders and derivatives players are driving the recent activity rather than long-term holders.

Market Capitalisation and Rating Update

Indus Towers is a large-cap stock with a market capitalisation of ₹1,11,027 crore. The company’s Mojo Score currently stands at 67.0, reflecting a Hold rating, an upgrade from a previous Sell rating issued on 7 Nov 2025. This rating improvement suggests a more favourable outlook based on recent fundamentals and price action, although the stock is not yet considered a strong buy.

Interpreting the Open Interest Surge

The 13.46% jump in open interest is a clear indication that market participants are increasing their exposure to Indus Towers derivatives. Given the stock’s proximity to its 52-week high and its outperformance relative to the sector, this surge likely reflects bullish sentiment. Traders may be positioning for a continuation of the upward trend, anticipating further gains in the near term.

Moreover, the substantial notional value in options contracts suggests that investors are actively using options strategies, possibly to hedge or leverage directional views. The large options value relative to futures indicates a preference for flexible risk management tools, which could include bullish call spreads or protective puts.

Liquidity and Trading Considerations

Liquidity remains adequate for sizeable trades, with the stock’s average traded value supporting trade sizes up to ₹4.85 crore based on 2% of the 5-day average traded value. This liquidity profile is favourable for institutional investors and active traders seeking to enter or exit positions without significant price impact.

However, the sharp decline in delivery volumes suggests caution. While derivatives activity is robust, the reduced participation in physical share delivery may imply that the rally is currently driven more by speculative or short-term trading rather than strong fundamental buying.

Sector and Market Context

Within the Telecom - Equipment & Accessories sector, Indus Towers stands out as a large-cap leader with solid technicals and improving market sentiment. The sector itself has shown moderate gains, but Indus Towers’ outperformance and upgraded rating highlight its relative strength. Investors should monitor sector trends closely, as any broad-based weakness could temper the stock’s momentum.

Outlook and Investor Implications

Given the recent upgrade from Sell to Hold and the positive technical signals, Indus Towers appears poised for cautious optimism. The surge in open interest and volume suggests that traders are increasingly confident in the stock’s near-term prospects. However, the diminished delivery volumes warrant a measured approach, as the rally may be more speculative than fundamentally driven at this stage.

Investors should watch for confirmation of sustained price strength above key moving averages and monitor open interest trends for signs of either fresh buying or profit-taking. Additionally, keeping an eye on sector developments and broader market conditions will be crucial to gauge the durability of the current momentum.

Summary

Indus Towers Ltd’s derivatives market activity reveals a notable increase in open interest and volume, signalling renewed market interest and potential directional bets favouring an upward move. The stock’s proximity to its 52-week high, outperformance relative to its sector, and upgraded Mojo rating to Hold reinforce a cautiously positive outlook. While liquidity supports active trading, the decline in delivery volumes suggests that investors should remain vigilant and consider both technical and fundamental factors before committing to sizeable positions.

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