Interglobe Aviation Sees Surge in Put Option Activity Amid Bearish Sentiment

Surge in Put Option Volumes and Open Interest

Data from the options market reveals that put contracts on Interglobe Aviation have been among the most actively traded, particularly for near-term expiries. The 24 February 2026 expiry saw 2,754 contracts traded at the ₹4,900 strike price, generating a turnover of approximately ₹259.76 lakhs and an open interest of 1,040 contracts. Similarly, the ₹4,850 strike put for the same expiry recorded 2,827 contracts traded with a turnover of ₹183.02 lakhs and open interest of 910 contracts.

Further, the ₹4,800 strike price has attracted the highest put volume for the 24 February expiry, with 3,925 contracts traded and an open interest of 1,455 contracts, indicating a strong concentration of bearish bets at this level. For the 30 March 2026 expiry, the ₹4,800 strike put saw 2,816 contracts traded, with turnover reaching ₹471.74 lakhs and open interest at 799 contracts.

This clustering of put option activity around the ₹4,800 to ₹4,900 strike prices, which are close to the current underlying value, suggests that investors are positioning for a potential downside or are hedging existing long exposures amid uncertainty.

Stock Performance and Sector Context

Interglobe Aviation’s stock price has recently reversed after three consecutive days of gains, closing down 2.17% on 19 February 2026. The intraday low touched ₹4,870.6, reflecting a sharper decline than the broader airline sector, which fell by 2.06% on the same day. Despite outperforming the sector marginally by 0.26% earlier in the session, the stock’s overall trend appears fragile.

Technical indicators show the stock trading above its 20-day moving average but below the 5-day, 50-day, 100-day, and 200-day moving averages, signalling mixed momentum and potential resistance at higher levels. Delivery volumes have also dropped sharply, with only 1.04 lakh shares delivered on 18 February, down 61.52% compared to the five-day average, indicating waning investor participation.

Liquidity remains adequate, with the stock’s average traded value supporting trade sizes of up to ₹4.36 crore, ensuring that option market activity is supported by a liquid underlying.

Mojo Score Downgrade Reflects Caution

Interglobe Aviation’s recent downgrade from Hold to Sell by MarketsMOJO on 3 December 2025 underscores the cautious outlook. The company’s Mojo Score currently stands at 38.0, reflecting weak fundamentals and limited near-term upside potential. The market cap grade is 1, indicating a large-cap status but with diminished quality metrics.

Investors should note that the downgrade aligns with the increased put option activity, suggesting that market participants are factoring in risks such as rising fuel costs, competitive pressures, or potential regulatory challenges that could weigh on the airline’s profitability.

Expiry Patterns and Investor Sentiment

The concentration of put option trades in the February and March 2026 expiries indicates a focus on short- to medium-term downside protection. The February expiry, in particular, shows heightened activity at strikes slightly above the current market price, which may reflect hedging against near-term volatility or a bearish view on upcoming earnings or macroeconomic developments.

Open interest levels at these strikes remain elevated, suggesting that these positions are not merely speculative but part of broader risk management strategies. The relatively high turnover in these contracts, especially at the ₹4,800 strike, points to active repositioning by institutional investors or traders anticipating a correction.

Sectoral and Market Implications

The airline sector has been under pressure recently, with broader indices like the Sensex declining only marginally by 0.13% on 19 February 2026, while airlines fell over 2%. Interglobe Aviation’s sharper decline and heavy put option interest may signal sector-specific headwinds such as fluctuating passenger demand, fuel price volatility, or geopolitical uncertainties affecting travel.

Given the stock’s large market capitalisation of ₹1,88,280.43 crore, its price movements and option market activity can have a significant impact on sectoral sentiment and derivative indices.

Investor Takeaway and Outlook

For investors, the heavy put option activity around Interglobe Aviation signals a cautious stance. The clustering of puts near the current stock price and the elevated open interest suggest that market participants are either hedging existing long positions or speculating on a downside move in the near term.

Given the recent downgrade and the stock’s technical positioning below key moving averages, the risk-reward profile appears skewed towards downside risk. However, the airline sector’s inherent volatility and potential for recovery amid improving travel demand mean that investors should monitor developments closely.

Those holding Interglobe Aviation shares may consider protective strategies such as buying puts or tightening stop-loss levels, while prospective buyers might wait for clearer signs of trend reversal or fundamental improvement before committing fresh capital.

Overall, the options market activity provides a valuable window into investor sentiment, highlighting the importance of integrating derivative data into equity analysis for a comprehensive view of market dynamics.

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