KEI Industries Sees Sharp Open Interest Surge Amid Strong Price Momentum

Open Interest and Volume Dynamics

On 3 February 2026, KEI Industries recorded an open interest (OI) of 13,928 contracts in its futures and options, marking a substantial increase of 2,026 contracts or 17.02% compared to the previous day’s OI of 11,902. This rise in OI is accompanied by a volume of 15,769 contracts, indicating strong participation in the derivatives market. The futures value stood at approximately ₹31,470 lakhs, while the options segment contributed a massive ₹9,073.98 crores, culminating in a total derivatives value of ₹33,530.26 lakhs.

The underlying stock price closed at ₹4,340, reflecting a day gain of 5.86%, outperforming the cable sector’s 4.67% rise and the broader Sensex’s 3.06% advance. The stock has been on an upward trajectory for two consecutive days, delivering an impressive 8.98% return over this period. Notably, KEI Industries opened with a gap-up of 5.4% and touched an intraday high of ₹4,560, a gain of 11.77% from the previous close.

Market Positioning and Technical Indicators

The surge in open interest alongside rising prices typically signals fresh buying interest and a bullish market stance. KEI Industries is trading above all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – underscoring a strong technical uptrend. The weighted average price suggests that more volume was traded near the lower price range, indicating accumulation by investors at relatively attractive levels.

Despite the strong price action, delivery volumes have seen a slight decline, with a delivery volume of 1.89 lakh shares on 2 February 2026, down 3.67% against the five-day average. This could imply that short-term traders and derivatives participants are driving the current momentum rather than long-term holders. However, liquidity remains adequate, with the stock’s traded value supporting trade sizes of up to ₹2.49 crore, ensuring smooth execution for institutional and retail investors alike.

Implications of the Open Interest Surge

The 17.02% increase in open interest, coupled with a strong price rally, suggests that market participants are positioning for further upside in KEI Industries. Such a pattern often reflects fresh long positions being established rather than short covering, especially when supported by rising volumes and price gains. This is further corroborated by the stock’s Mojo Score of 72.0 and an upgraded Mojo Grade from Hold to Buy as of 29 January 2026, signalling improved fundamentals and positive market sentiment.

KEI Industries, a mid-cap player in the cables and electricals sector with a market capitalisation of ₹42,876 crore, has been benefiting from sector tailwinds and robust demand outlook. The cable sector itself has gained 4.67% recently, but KEI’s outperformance by over 1.35% relative to its sector peers highlights its growing investor appeal.

Directional Bets and Derivatives Strategy

Derivatives data reveals that traders are increasingly betting on a bullish trajectory for KEI Industries. The futures and options market activity, with a combined value exceeding ₹33,500 lakhs, indicates significant capital allocation towards this stock. The rising open interest in conjunction with price appreciation typically points to fresh long bets rather than short covering, suggesting confidence in sustained upward momentum.

Investors should note that while the stock is trading above all major moving averages, the weighted average price clustering near the lower end of the day’s range may indicate cautious accumulation. This could be a sign that participants are building positions gradually, anticipating further positive triggers such as strong quarterly earnings or sectoral growth catalysts.

Given the current market positioning, traders might consider strategies that capitalise on the bullish sentiment, such as buying futures or call options, while keeping an eye on volatility and potential profit booking at resistance levels near the recent intraday high of ₹4,560.

Broader Market Context and Outlook

KEI Industries’ recent performance must be viewed within the broader market and sector context. The Sensex’s modest gain of 3.06% on the day contrasts with KEI’s 5.86% rise, underscoring the stock’s relative strength. The cables and electricals sector, driven by infrastructure development and industrial demand, continues to attract investor interest, providing a favourable backdrop for KEI’s growth prospects.

However, investors should remain vigilant to potential volatility, especially given the falling delivery volumes which may indicate a higher proportion of speculative trading. The stock’s liquidity profile supports sizeable trades, but sudden shifts in market sentiment or macroeconomic factors could impact price stability.

KEI’s upgraded Mojo Grade to Buy, combined with a solid Mojo Score of 72.0, reflects improved financial metrics and positive earnings outlook. The company’s mid-cap status with a market cap of ₹42,876 crore positions it well to benefit from sectoral growth while maintaining agility in a competitive environment.

In summary, the sharp increase in open interest and volume, alongside strong price action and technical indicators, suggests that KEI Industries is currently in a favourable phase for investors seeking exposure to the cables and electricals sector. The market’s directional bets appear to favour further upside, supported by robust fundamentals and positive sentiment.

Investors and traders should continue to monitor derivatives activity, price momentum, and sector developments to capitalise on emerging opportunities while managing risk prudently.

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