Maruti Suzuki Sees Heavy Put Option Activity Amid Bearish Market Sentiment

Intense Put Option Trading Highlights Bearish Sentiment

On 27 January 2026, Maruti Suzuki witnessed a surge in put option activity, with 2,981 contracts traded at the 15,000 strike price for the expiry date of 24 February 2026. This volume translated into a turnover of approximately ₹686.36 lakhs, reflecting significant investor interest in downside protection or speculative bearish bets. The open interest at this strike stands at 2,179 contracts, indicating that a sizeable number of traders are maintaining their bearish positions or hedges as the expiry approaches.

The underlying stock price hovered near ₹14,956, just below the critical 15,000 strike, suggesting that the put options are positioned close to the money. This proximity often attracts traders anticipating further declines or seeking to capitalise on volatility ahead of the expiry.

Price Performance and Technical Context

Maruti Suzuki’s stock has underperformed its sector peers, falling by 1.78% on the day compared to a modest 0.20% decline in the broader automobile sector. The Sensex, in contrast, managed a positive return of 0.52%, underscoring the stock’s relative weakness. Notably, the share price has been on a downward trajectory for six consecutive sessions, losing 6.96% over this period.

Intraday lows touched ₹14,861, marking a 2.52% drop on the day and signalling persistent selling pressure. The stock trades above its 200-day moving average, a long-term support level, but remains below its 5-day, 20-day, 50-day, and 100-day moving averages. This technical setup suggests short- to medium-term weakness despite longer-term resilience, a pattern often associated with cautious investor sentiment and potential further downside risk.

Rising Investor Participation and Liquidity

Investor engagement has intensified, with delivery volumes reaching 3.17 lakh shares on 27 January, a 57.63% increase over the five-day average. This heightened participation reflects growing conviction among market participants, either in repositioning portfolios or executing hedging strategies amid uncertainty.

Liquidity remains robust, with the stock’s traded value supporting sizeable transactions up to ₹12.4 crore based on 2% of the five-day average traded value. Such liquidity is conducive to active options trading and allows institutional and retail investors to implement complex strategies without significant market impact.

Mojo Score Downgrade Reflects Caution

Maruti Suzuki currently holds a Mojo Score of 65.0 with a Mojo Grade of Hold, reflecting a cautious stance by analysts. This represents a downgrade from a previous Buy rating assigned on 12 January 2026. The downgrade signals tempered expectations amid the recent price weakness and increased bearish positioning in the options market.

The company’s market capitalisation stands at a substantial ₹4,70,754.97 crore, categorising it as a large-cap stock with significant institutional interest. Despite its size and sector leadership, the recent technical and options market signals suggest investors are bracing for near-term volatility and potential downside risks.

Put Options as a Hedge and Speculative Tool

The heavy put option activity at the 15,000 strike price expiring in late February indicates that market participants are either hedging existing long positions or speculating on further declines. Put options provide a form of insurance against falling prices, and the elevated open interest suggests that many investors are positioning defensively.

Given the stock’s recent six-day losing streak and underperformance relative to the sector, the put buying may also reflect growing bearish sentiment. Traders could be anticipating negative catalysts such as subdued demand forecasts, supply chain disruptions, or broader market corrections impacting the automobile sector.

Sector and Market Comparison

While Maruti Suzuki has lagged the automobile sector’s modest decline, the broader market has shown resilience with the Sensex posting gains. This divergence highlights stock-specific challenges that may not be fully reflected in sector indices. Investors should monitor upcoming earnings releases, policy developments, and global economic indicators that could influence the stock’s trajectory.

Technically, the stock’s position below multiple moving averages but above the 200-day average suggests a critical juncture. A sustained break below the 200-day moving average could trigger further selling, while a rebound above shorter-term averages might alleviate bearish pressures.

Investor Takeaways and Outlook

Investors should approach Maruti Suzuki with caution given the current technical weakness and pronounced bearish sentiment in the options market. The stock’s recent downgrade to a Hold rating and the surge in put option volumes suggest that downside risks are being actively priced in.

Those holding long positions may consider protective strategies such as buying puts or tightening stop-loss levels. Conversely, traders with a bearish outlook might find opportunities in put options near the 15,000 strike price, especially with the 24 February expiry date approaching.

However, the stock’s large-cap status and underlying fundamentals warrant close monitoring of upcoming corporate developments and sector trends. Any positive surprises or technical rebounds could quickly alter the current sentiment and reduce downside risks.

Conclusion

Maruti Suzuki India Ltd’s prominence in put option trading underscores a market environment fraught with caution and hedging activity. The stock’s sustained price decline, technical challenges, and downgrade in analyst ratings combine to create a complex risk-reward scenario for investors. Close attention to options market dynamics and price action will be essential in navigating this evolving landscape.

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