Rs 1,050 Puts — 1.5% Below Current Price — Draw 10,894 Contracts on Infosys Ltd

Put Options Event and Cash Market Context

On 24 Jul 2026, Infosys Ltd witnessed significant put option activity concentrated around the 28 July expiry. The Rs 1,050 strike saw 10,894 contracts traded, generating a turnover of approximately ₹93.47 crores. This was the most active put strike by volume, followed by Rs 1,030 with 10,800 contracts and Rs 1,025 with 7,090 contracts. The underlying stock closed at Rs 1,034, down 1.43% on the day and has been on a five-day losing streak, falling nearly 5.93% over that period.

The open interest at Rs 1,050 stands at 8,779 contracts, indicating that a substantial portion of the traded volume represents fresh positioning rather than mere rollovers or unwinding. The proximity of the expiry date adds urgency to these trades, as positions will be resolved within days.

The stock’s recent underperformance relative to its sector and the broader Sensex, combined with its trading below all major moving averages (5, 20, 50, 100, and 200-day), sets a bearish technical backdrop. However, the put strikes traded are mostly out-of-the-money or just slightly in-the-money, which complicates the interpretation — is this activity signalling hedging, bearish conviction, or put writing?

Strike Price Analysis: Moneyness and Intent

The Rs 1,050 strike sits roughly 1.5% above the current market price of Rs 1,034, making these puts slightly in-the-money. The Rs 1,030 and Rs 1,025 strikes are at-the-money or just out-of-the-money, while the Rs 990 strike is significantly out-of-the-money, about 4.3% below the current price, with 3,825 contracts traded.

Typically, put options that are out-of-the-money and traded in large volumes on a falling stock can indicate directional bearish bets. Conversely, slightly in-the-money puts or those close to the money on a stock that is declining may reflect protective hedging by long holders seeking to limit downside risk. The Rs 1,050 strike’s volume and open interest suggest a strong interest in downside protection just above the current price level.

Meanwhile, the Rs 990 strike’s lower volume and open interest imply less conviction in a sharp decline below that level, which is near the 52-week low of Rs 982.4. This distribution of activity points to a focus on cushioning losses rather than outright bearish speculation on a collapse.

Interpreting the Put Activity: Multiple Perspectives

The put activity on Infosys Ltd can be read in several ways. First, the heavy volume at strikes close to the current price, combined with the stock’s recent downtrend, supports the view of bearish positioning. Traders may be buying puts to profit from further declines or to hedge short-term downside risk.

Second, given the stock’s proximity to key support levels and the fact that the Rs 1,050 strike is slightly in-the-money, the activity could also represent protective hedging by existing long investors. This is especially plausible since the stock is trading below all major moving averages, a technical environment where downside protection is prudent. Is this a sign that longs are bracing for a pullback or a more sustained correction? The data alone cannot fully resolve this ambiguity.

Third, put writing or selling is less likely here given the high turnover and open interest accumulation at these strikes. Put sellers typically collect premium on out-of-the-money strikes expecting the stock to remain above those levels. The Rs 990 strike, which is the most out-of-the-money, shows relatively modest activity, suggesting limited put writing interest.

Open Interest and Contracts Analysis

The ratio of contracts traded to open interest at the Rs 1,050 strike is approximately 1.24:1, indicating that much of the volume represents fresh positions rather than closing trades. This fresh activity suggests that traders are actively adjusting their exposure ahead of the 28 July expiry.

Open interest at the Rs 1,030 and Rs 1,025 strikes is lower relative to traded volume, reinforcing the idea of new positioning rather than rollovers. The Rs 1,050 strike’s open interest of 8,779 contracts is the highest among the put strikes, signalling a concentration of interest at this level.

Such a pattern is consistent with investors seeking downside protection near the current price, rather than speculative bets on a sharp decline. The relatively lower open interest at the Rs 990 strike, despite some volume, suggests less confidence in a steep drop below that level.

Cash Market Context: Technical and Volume Indicators

Infosys Ltd has been under pressure recently, trading below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages. This broad weakness aligns with the put activity focused near the current price, as investors seek to hedge or express caution.

However, delivery volumes have risen sharply, with 74.66 lakh shares delivered on 23 July, a 51.08% increase over the five-day average. This suggests that despite the price decline, investor participation remains robust, which may temper outright bearishness in the options market.

The stock is also only 4.76% above its 52-week low of Rs 982.4, a level that could act as a technical floor. The put strikes clustered around Rs 1,050 and Rs 1,030 roughly correspond to support zones below the 50-day moving average, consistent with hedging strategies rather than aggressive bearish bets.

Conclusion: Protective Hedging More Likely Than Bearish Speculation

The heavy put option activity on Infosys Ltd ahead of the 28 July expiry is concentrated at strikes slightly above and near the current price, with significant fresh positioning. While the stock’s recent decline and technical weakness support a bearish interpretation, the strike distribution and open interest patterns suggest that much of this activity is likely protective hedging by long investors rather than outright bearish bets.

The elevated delivery volumes and proximity to key support levels reinforce this view, indicating that investors may be bracing for a short-term pullback rather than a sustained downtrend. Put writing appears limited, and the lower volume at deep out-of-the-money strikes suggests less conviction in a sharp fall.

Ultimately, the options data and cash market context together point to a cautious stance among investors, balancing downside protection with the possibility of a technical rebound — should investors consider hedging their positions in Infosys Ltd or is the recent weakness a buying opportunity?

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