Kalyan Jewellers Sees Heavy Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights

Data from the derivatives market reveals that Kalyan Jewellers (underlying symbol KALYANKJIL) has emerged as one of the most actively traded stocks in put options. The most significant activity is concentrated in the 24 February 2026 expiry series, where 2,122 contracts were traded at the ₹370 strike price, generating a turnover of ₹813.58 lakhs. Open interest at this strike stands at 2,845 contracts, indicating sustained interest from traders betting on or hedging against a decline in the stock price.

In addition, the 27 January 2026 expiry saw 2,199 put contracts traded at the ₹360 strike price, with turnover of ₹217.82 lakhs and open interest of 334 contracts. This near-term expiry activity suggests immediate bearish positioning or protective hedging as the stock navigates recent volatility.

Price and Technical Context

Kalyan Jewellers’ underlying stock price currently trades at ₹362.8, below key moving averages including the 5-day, 20-day, 50-day, 100-day, and 200-day averages. The stock hit a fresh 52-week low of ₹347.5 on 27 January 2026, marking a 5.36% intraday decline. Despite this, the stock has shown a modest rebound after 11 consecutive days of falls, though it still underperformed its sector by 0.59% on the day.

Weighted average prices indicate that most volume has been transacted near the day’s low, underscoring selling pressure. Delivery volumes have also declined by 19.47% compared to the five-day average, signalling reduced investor participation in the cash segment. Liquidity remains adequate, with the stock capable of handling trade sizes up to ₹14.05 crores based on recent average traded value.

Bearish Positioning and Hedging Implications

The concentration of put option activity at strike prices slightly above and near the current market price suggests that traders are positioning for further downside or seeking to hedge existing long exposures. The ₹370 strike put options with February expiry, commanding the highest open interest and turnover, imply a significant level of protection or speculative bearish bets at this level.

Similarly, the active trading in the near-term ₹360 strike puts ahead of the January expiry points to immediate concerns over the stock’s short-term trajectory. This pattern is consistent with a cautious market outlook, especially given the stock’s recent technical weakness and sector underperformance.

Fundamental and Market Sentiment Overview

Kalyan Jewellers operates in the Gems, Jewellery and Watches sector, a segment currently facing headwinds due to fluctuating gold prices and cautious consumer spending. The company’s market capitalisation stands at ₹37,945 crores, categorising it as a mid-cap stock. Despite its size, the stock’s Mojo Score has deteriorated to 47.0, with a recent downgrade from Hold to Sell on 19 January 2026, reflecting weakening fundamentals and negative analyst sentiment.

The market cap grade of 2 further indicates limited strength relative to peers. This downgrade and the bearish technical signals have likely contributed to the increased put option interest as investors seek downside protection or speculate on further declines.

Sector and Broader Market Comparison

On 27 January 2026, Kalyan Jewellers’ stock declined by 0.89%, underperforming the Gems, Jewellery and Watches sector which fell by 0.11%. Meanwhile, the Sensex gained 0.37%, highlighting the stock’s relative weakness amid broader market resilience. This divergence emphasises the stock-specific challenges faced by Kalyan Jewellers, including subdued investor confidence and technical deterioration.

Such sector underperformance often triggers increased hedging activity, as reflected in the put option volumes, as market participants seek to mitigate risk or capitalise on anticipated declines.

Investor Takeaways and Outlook

Investors should note the heightened put option activity as a clear signal of bearish sentiment or risk aversion towards Kalyan Jewellers. The concentration of open interest at strikes above the current market price suggests that market participants are either hedging existing long positions or speculating on further downside.

Given the stock’s technical weakness, recent 52-week lows, and downgrade in Mojo Grade to Sell, cautious investors may consider reducing exposure or employing protective strategies. Conversely, contrarian investors might monitor for signs of a sustained reversal, though current indicators remain negative.

Liquidity remains sufficient for sizeable trades, but the declining delivery volumes and underperformance relative to sector and benchmark indices warrant careful analysis before initiating fresh positions.

Expiry Patterns and Strategic Implications

The clustering of put option activity around the 24 February and 27 January expiries indicates that traders are focusing on short- to medium-term risk management. The January expiry activity suggests immediate hedging needs or speculative bets, while the February expiry interest points to a more extended bearish outlook or protection horizon.

Market participants should watch for changes in open interest and volume in these strikes as expiry dates approach, which could provide further clues on directional conviction and potential price movements.

Conclusion

Kalyan Jewellers India Ltd is currently under significant bearish pressure as evidenced by the surge in put option trading and deteriorating technical and fundamental indicators. The stock’s recent downgrade to a Sell rating, combined with its underperformance relative to sector peers and the broader market, has prompted investors to seek downside protection through options.

While the stock has shown a minor bounce after an extended decline, the prevailing sentiment remains cautious. Investors should carefully weigh the risks and consider hedging strategies or alternative investments until clearer signs of recovery emerge.

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