ITC Ltd Sees Heavy Put Option Activity Amid Bearish Sentiment

Heavy Put Option Trading Highlights Investor Caution

The most active put options for ITC Ltd. have been concentrated at the ₹320 strike price, with 8,458 contracts traded recently. This surge in put activity generated a turnover of approximately ₹284.19 lakhs, reflecting substantial investor interest in downside protection or speculative bearish bets. Open interest at this strike stands at 2,267 contracts, indicating that a sizeable number of positions remain open as expiry approaches.

This heightened put option activity contrasts with the underlying stock’s recent performance, which has been relatively resilient. ITC has gained 3.79% over the past two trading sessions, touching an intraday high of ₹328.05 on 16 February 2026, outperforming the broader Cigarettes/Tobacco sector’s 2.47% gain and the Sensex’s marginal decline of 0.06% on the same day.

Technical and Market Context

Despite the recent uptick, ITC’s price remains below its longer-term moving averages, including the 50-day, 100-day, and 200-day averages, suggesting that the stock is still under pressure from a medium-term perspective. It trades above its 5-day and 20-day moving averages, indicating some short-term strength, but the overall trend remains cautious.

Investor participation has shown signs of waning, with delivery volumes falling by 25.27% against the five-day average, signalling reduced conviction among buyers. Liquidity remains adequate, with the stock’s traded value supporting sizeable transactions up to ₹9.62 crores, ensuring that option and stock trades can be executed without significant price impact.

Mojo Score and Analyst Ratings

MarketsMOJO assigns ITC Ltd. a Mojo Score of 48.0, categorising it as a Sell with a recent downgrade from Hold on 9 February 2026. The company’s market cap grade is 1, reflecting its large-cap status with a market capitalisation of ₹4,07,575.83 crores. This downgrade aligns with the increased put option activity, suggesting that analysts and investors are factoring in potential downside risks in the near term.

Expiry Patterns and Investor Positioning

The put options expiring on 24 February 2026 have attracted the most attention, with the ₹320 strike price serving as a key level of interest. This strike is slightly below the current market price, indicating that investors are either hedging against a modest decline or speculating on a near-term pullback. The open interest concentration at this strike suggests that many traders expect the stock to test or breach this level before expiry.

Such positioning is typical in a market environment where uncertainty prevails. Investors may be using puts to protect long stock holdings or to capitalise on anticipated volatility. The sizeable turnover and open interest also imply that market makers and institutional players are actively managing risk around ITC’s price movements.

Sectoral and Broader Market Implications

ITC’s performance is closely tied to the Cigarettes/Tobacco sector, which has shown moderate gains recently. However, the sector’s overall momentum is tempered by regulatory concerns and shifting consumer preferences. The divergence between ITC’s short-term gains and the increased put option activity may reflect investor caution about these headwinds.

Moreover, the broader FMCG sector is facing mixed signals amid inflationary pressures and changing consumption patterns. ITC’s large-cap status and diversified portfolio provide some buffer, but the downgrade in its Mojo Grade and the bearish options activity highlight the challenges ahead.

Investor Takeaways and Outlook

For investors, the surge in put option activity at the ₹320 strike price ahead of the 24 February expiry is a clear signal to monitor ITC Ltd. closely. While the stock has shown short-term strength, the technical backdrop and analyst downgrade suggest caution. The put buying could be a hedge against potential downside or a speculative bet on a correction.

Given the stock’s large-cap status and liquidity, active traders can consider strategies that balance risk and reward, such as protective puts or spreads. Long-term investors should weigh the recent downgrade and sectoral challenges against ITC’s fundamental strengths and dividend track record.

Overall, the options market is signalling a more cautious stance on ITC Ltd., reflecting broader uncertainties in the FMCG space and the tobacco sector. Investors would do well to stay informed of evolving market dynamics and adjust their portfolios accordingly.

Summary of Key Metrics:

• Current stock price: ₹325.20
• Most active put strike: ₹320
• Put contracts traded: 8,458
• Put turnover: ₹284.19 lakhs
• Open interest at ₹320 strike: 2,267 contracts
• Mojo Score: 48.0 (Sell, downgraded from Hold on 09 Feb 2026)
• Market cap: ₹4,07,575.83 crores (Large Cap)
• Recent 2-day return: +3.79%
• Sector gain (Cigarettes/Tobacco): +2.47%
• Sensex 1-day return: -0.06%

Investors should continue to monitor option expiry dates and open interest trends for further clues on market sentiment towards ITC Ltd.

Unlock special upgrade rates for a limited period. Start Saving Now →