Maruti Suzuki Sees Heavy Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights

Data from the derivatives market reveals that Maruti Suzuki’s put options with a strike price of ₹16,500 expiring on 27 January 2026 have witnessed the highest trading volume among all put contracts. A total of 2,592 contracts changed hands, generating a turnover of ₹241.57 lakhs. Open interest stands robust at 2,504 contracts, indicating sustained interest and accumulation of bearish bets or protective hedges.

The underlying stock closed at ₹16,673 on 7 January 2026, just 4.46% shy of its 52-week high of ₹17,370. Despite this proximity to peak levels, the stock has underperformed its sector by 0.69% on the day and has recorded a consecutive two-day decline, losing 3.84% over this short span. This juxtaposition of near-record highs with recent weakness is likely prompting investors to seek downside protection through put options.

Technical and Market Context

Maruti Suzuki’s price action shows a mixed technical picture. The stock remains above its 20-day, 50-day, 100-day, and 200-day moving averages, signalling a longer-term uptrend. However, it is currently trading below its 5-day moving average, reflecting short-term selling pressure. Rising investor participation is evident, with delivery volumes on 7 January reaching 2.21 lakh shares, a 36.8% increase over the five-day average, suggesting heightened trading interest amid volatility.

Liquidity remains strong, with the stock’s traded value supporting sizeable trades up to ₹10.43 crore comfortably, ensuring that option market activity is backed by a liquid underlying.

Investor Sentiment and Hedging Strategies

The surge in put option volumes at the ₹16,500 strike price suggests that investors are either hedging existing long positions or speculating on a near-term correction. Given the stock’s recent underperformance relative to the sector and the broader Sensex, which declined by 0.17% on the same day, cautious positioning is understandable.

Maruti Suzuki’s market capitalisation stands at a substantial ₹5,24,297.73 crore, categorising it as a large-cap stock with significant institutional ownership. The company’s Mojo Score of 72.0 and an upgraded Mojo Grade from Hold to Buy as of 5 January 2026 reflect improving fundamentals and positive analyst sentiment. However, the current put option activity indicates that market participants are balancing optimism with prudent risk management.

Expiry Patterns and Market Implications

The 27 January expiry is attracting concentrated put option interest, which often precedes volatility as traders adjust positions ahead of contract settlement. The open interest of 2,504 contracts at the ₹16,500 strike is sizeable, signalling that this level is a key psychological and technical threshold for market participants.

Should the stock price dip below this strike in the coming weeks, these put holders stand to gain, potentially accelerating downward momentum. Conversely, if the stock holds above this level, put sellers may face losses, which could limit downside. This dynamic creates a critical battleground for price action in the near term.

Comparative Sector and Market Performance

Within the automobile sector, Maruti Suzuki’s 1-day return of -0.79% lags behind the sector’s -0.27% and the Sensex’s -0.17%, highlighting relative weakness. This underperformance, combined with the put option surge, suggests that investors are selectively cautious about Maruti Suzuki’s short-term prospects despite its strong market position.

Longer-term moving averages and the company’s fundamental upgrades provide a counterbalance, indicating that any correction may be viewed as a buying opportunity by value-oriented investors.

Outlook and Investor Takeaways

Maruti Suzuki’s current option market activity underscores a cautious stance among traders, reflecting concerns about near-term volatility despite the company’s solid fundamentals and recent upgrades. Investors should monitor the ₹16,500 strike price closely as a key support level, with expiry dynamics likely to influence price swings in the coming weeks.

For long-term investors, the upgraded Mojo Grade to Buy and a strong market cap grade of 1 reinforce the stock’s attractiveness, especially if short-term weakness provides an entry point. However, active traders and hedgers should remain vigilant of the evolving put option interest and price action around critical technical levels.

Overall, the interplay between bullish fundamentals and bearish option positioning creates a nuanced risk-reward scenario for Maruti Suzuki in January 2026.

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