Robust Put Option Volumes Signal Bearish Sentiment
On 16 and 17 April 2026, ITC Ltd (NSE: ITC) emerged as one of the most actively traded stocks in the put options segment, with multiple strike prices seeing substantial contract volumes. The underlying stock closed at ₹306.40, while the most traded put options clustered around strike prices of ₹310, ₹305, ₹300, and ₹290, all expiring on 28 April 2026.
The highest number of contracts traded was at the ₹300 strike, with 4,008 contracts exchanging hands, generating a turnover of approximately ₹78.88 lakhs and an open interest of 3,125 contracts. This was closely followed by the ₹305 strike, which saw 3,116 contracts traded, turnover of ₹128.13 lakhs, and open interest of 1,470 contracts. The ₹290 strike also attracted significant attention with 2,294 contracts traded and an open interest of 2,452 contracts, albeit with a lower turnover of ₹17.98 lakhs.
Such elevated put option activity at strike prices near and slightly below the current market price suggests that market participants are positioning for potential downside or are actively hedging existing long exposures. The concentration of open interest at these strikes indicates that traders are anticipating volatility or a possible correction in the near term.
Stock Performance and Technical Context
ITC Ltd’s stock has been on a modest upward trajectory, gaining 2.48% over the past three consecutive trading sessions. On 17 April, the stock recorded an intraday high of ₹309.95, a 2.16% increase from the previous close. However, it underperformed its FMCG sector peers by 0.54% on the day, with the sector advancing 1.47% and the broader Sensex marginally down by 0.03%.
Technically, the stock is trading above its 5-day and 20-day moving averages but remains below its 50-day, 100-day, and 200-day moving averages. This mixed technical picture may be contributing to the cautious stance among options traders, who appear to be balancing optimism with protective bearish bets.
Investor participation has shown signs of waning, with delivery volumes falling by nearly 29% to 89.68 lakh shares on 16 April compared to the five-day average. Despite this, liquidity remains adequate, with the stock’s traded value supporting sizeable trade sizes up to ₹11.2 crores based on 2% of the five-day average traded value.
Mojo Score Upgrade Reflects Cautious Optimism
ITC Ltd’s MarketsMOJO score has recently improved to 51.0, upgrading the stock’s rating from a Sell to a Hold on 15 April 2026. This reflects a tempered outlook, acknowledging the company’s large-cap status and steady fundamentals while recognising near-term uncertainties. The stock’s market capitalisation stands at a robust ₹3,80,207 crores, underscoring its significance within the FMCG sector.
Expiry Patterns and Investor Implications
The expiry date of 28 April 2026 is less than two weeks away, intensifying the focus on option positioning. The clustering of put option open interest and turnover near the ₹300 to ₹310 range suggests a key support zone that traders are watching closely. Should the stock breach these levels, it could trigger further downside momentum, validating the bearish bets.
Conversely, if ITC maintains or surpasses the ₹310 level, many of these put options may expire worthless, potentially leading to short covering and a relief rally. The current put-heavy positioning may therefore also serve as a hedge against volatility rather than outright bearish speculation.
Broader Market and Sector Context
Within the FMCG sector, ITC’s relative underperformance on the day contrasts with the sector’s overall strength, highlighting stock-specific factors influencing investor sentiment. The FMCG sector is generally viewed as defensive, but ITC’s diversified business model, including tobacco, packaged foods, and agribusiness, exposes it to varying demand cycles and regulatory risks.
Investors should monitor upcoming corporate announcements, macroeconomic indicators, and sectoral trends that could impact ITC’s price trajectory and option market dynamics in the coming weeks.
Conclusion: Strategic Hedging Amid Uncertainty
The surge in put option activity for ITC Ltd ahead of the April expiry reflects a nuanced market stance combining cautious optimism with prudent risk management. While the stock has shown resilience with recent gains and a positive mojo upgrade, the heavy put volumes at strikes near the current price indicate that investors are preparing for potential volatility or downside risks.
For market participants, this environment calls for close monitoring of price action around key technical levels and expiry-related option dynamics. The interplay between the stock’s fundamental outlook and option market positioning will be critical in shaping ITC’s near-term performance and investor sentiment.
