Kaynes Technology Sees Heavy Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights

Data from the derivatives market reveals that Kaynes Technology’s put options have dominated the most active contracts list, particularly for the expiry on 24 February 2026. The strike prices attracting the highest volumes are ₹3,000, ₹3,300, ₹3,400, and ₹3,500, all below or near the current underlying value of ₹3,537.1. Notably, the 3,400 and 3,500 strike puts have recorded the largest number of contracts traded, with 5,301 and 5,279 contracts respectively.

The turnover for these strikes is substantial, with the ₹3,500 strike alone generating nearly ₹9.87 crores in premium value, followed by ₹8.02 crores at ₹3,400 and ₹6.01 crores at ₹3,300. Open interest figures further corroborate the bearish positioning, with 3,152 contracts outstanding at ₹3,500 and over 2,200 contracts at the ₹3,300 and ₹3,000 strikes. This concentration of open interest suggests that traders are either hedging existing long positions or speculating on a potential downside move in the near term.

Technical and Price Action Context

Kaynes Technology’s recent price action supports the surge in put buying. The stock has underperformed its sector by 2.58% today and has declined by 7.19% over the last two sessions. It opened sharply lower by 5.56% on 6 February 2026 and touched an intraday low of ₹3,337.1, representing a 7.72% drop from the previous close. The weighted average traded price skewed towards the day’s low, indicating selling pressure throughout the session.

Technically, the stock is trading below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a sustained downtrend. The rising delivery volume of 4.23 lakh shares on 5 February, up 7.18% from the five-day average, points to increased investor participation amid the decline. Liquidity remains adequate, with the stock capable of handling trade sizes up to ₹18.13 crores based on recent average traded value.

Bearish Sentiment and Market Positioning

The heavy put option activity at strike prices ranging from ₹3,000 to ₹3,500 indicates that market participants are bracing for a potential correction or increased volatility in Kaynes Technology’s shares. The stock’s Mojo Score of 30.0 and a downgrade from Hold to Sell on 1 December 2025 reflect deteriorating fundamentals and technical outlook. The Market Cap Grade of 2 further underscores the mid-cap stock’s vulnerability in the current market environment.

Investors appear to be using put options as a hedge against further downside risk or as a speculative tool to capitalise on anticipated weakness. The clustering of open interest near the ₹3,500 strike, just below the current market price, suggests a key support level that traders are watching closely. Should the stock breach this level decisively, the put options could gain further value, amplifying bearish momentum.

Comparatively, the stock’s 1-day return of -2.62% significantly lags the sector’s -0.59% and the Sensex’s -0.41%, highlighting its relative underperformance. This divergence may be attracting short sellers and option traders seeking to exploit the stock’s weakness.

Expiry Patterns and Implications for Investors

The 24 February 2026 expiry is shaping up as a critical juncture for Kaynes Technology. The concentration of put option volumes and open interest at multiple strikes suggests that traders are actively positioning ahead of this date. Such activity often precedes increased volatility as option writers and holders adjust their positions in response to price movements and time decay.

For investors, this environment calls for caution. The stock’s technical weakness, combined with bearish option market signals, indicates that downside risks remain elevated. Those holding long positions may consider protective strategies such as buying puts or tightening stop-loss levels. Conversely, traders with a bearish outlook might explore put buying or selling call options to capitalise on the anticipated volatility.

It is also important to monitor the stock’s reaction to broader market trends and sector performance, as Kaynes Technology’s industrial manufacturing peers have shown mixed results recently. The company’s mid-cap status and relatively modest Market Cap Grade suggest that it may be more susceptible to market swings compared to larger, more stable stocks.

Fundamental and Quality Assessment

Kaynes Technology’s downgrade from Hold to Sell by MarketsMOJO on 1 December 2025 reflects concerns over its financial and operational metrics. The Mojo Score of 30.0 is below average, signalling weak momentum and quality factors. Investors should weigh these fundamental considerations alongside technical and options market data when making decisions.

Given the stock’s current trajectory and the evident bearish positioning in the options market, a cautious approach is warranted. Monitoring open interest changes and strike price concentrations in the coming days will provide further clues on market sentiment and potential price direction.

Conclusion

Kaynes Technology India Ltd is currently under significant bearish pressure as evidenced by heavy put option trading ahead of the 24 February 2026 expiry. The clustering of open interest at strikes between ₹3,000 and ₹3,500, combined with recent price weakness and technical deterioration, suggests investors are bracing for further downside or hedging existing exposure. While the stock remains liquid and actively traded, its downgrade and low Mojo Score highlight fundamental challenges that may weigh on performance.

Investors should remain vigilant and consider protective measures or alternative opportunities, especially given the availability of better-rated stocks across sectors. The evolving options market activity will be a key indicator to watch as expiry approaches, signalling shifts in sentiment and potential volatility spikes.

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