Mphasis Ltd Sees Significant Open Interest Surge Amid Rising Market Momentum

Open Interest and Volume Dynamics

On 22 Jan 2026, Mphasis recorded an open interest of 27,703 contracts in its derivatives, up from 25,161 contracts the previous day, marking a substantial increase of 2,542 contracts or 10.1%. This rise in OI is accompanied by a futures volume of 18,488 contracts, indicating heightened trading activity and investor engagement. The futures value stood at ₹60,499.92 lakhs, while the options segment contributed a massive ₹8,597.00 crores, culminating in a total derivatives value of approximately ₹61,805.41 lakhs.

The underlying stock price closed at ₹2,839, having touched an intraday high of ₹2,889.90, a gain of 3.25% on the day. This price movement, combined with the OI expansion, signals that fresh positions are being established rather than existing ones being squared off, a classic indicator of strengthening market conviction.

Market Positioning and Directional Bets

The surge in open interest alongside rising volumes typically points to increased participation by institutional and retail investors anticipating a directional move. In Mphasis’s case, the stock has outperformed its sector by 0.8% and the Sensex by 1.23% on the day, suggesting bullish sentiment. The stock’s 1-day return of 1.41% contrasts favourably with the sector’s 0.70% and Sensex’s 0.18%, reinforcing the notion of relative strength.

Technical indicators reveal that Mphasis is trading above its 50-day, 100-day, and 200-day moving averages, underscoring a medium- to long-term uptrend. However, it remains below its 5-day and 20-day moving averages, indicating some short-term consolidation or profit booking. This mixed technical picture may be encouraging traders to position for a potential breakout, as reflected in the derivatives market activity.

Investor participation has notably increased, with delivery volumes on 21 Jan rising by 223.66% to 9.05 lakh shares compared to the 5-day average. Such a spike in delivery volume suggests genuine accumulation rather than speculative trading, which often precedes sustained price appreciation.

Mojo Score Upgrade and Market Capitalisation Insights

Mphasis’s recent upgrade in its Mojo Grade from Hold to Buy on 19 Jan 2026, with a Mojo Score of 72.0, reflects improved fundamentals and positive market outlook. This upgrade is significant given the company’s mid-cap status with a market capitalisation of ₹54,085.84 crores, positioning it well within the Computers - Software & Consulting sector.

The market cap grade of 2 indicates moderate size and liquidity, which is corroborated by the stock’s ability to handle trade sizes of up to ₹4.57 crores based on 2% of the 5-day average traded value. Such liquidity is attractive for institutional investors looking to build or unwind sizeable positions without excessive market impact.

Implications for Investors and Traders

The combination of rising open interest, increasing volumes, and a positive price trend suggests that market participants are positioning for an upward move in Mphasis. The stock’s outperformance relative to its sector and the broader market, along with strong delivery volumes, indicates genuine buying interest rather than speculative momentum.

However, the short-term technical resistance posed by the 5-day and 20-day moving averages warrants caution. Traders may look for a decisive breakout above these levels to confirm sustained bullish momentum. Meanwhile, the derivatives market activity provides valuable clues about institutional sentiment and potential directional bets.

Investors should also consider the broader sectoral trends and global IT spending outlook, as these factors will influence Mphasis’s earnings trajectory and valuation multiples. The company’s consistent delivery and improving fundamentals, as reflected in its Mojo upgrade, add to the positive case.

Conclusion: Renewed Confidence in Mphasis Amidst Derivatives Activity

The recent surge in open interest and volume in Mphasis’s derivatives market is a clear indication of renewed investor confidence and a potential directional shift. The stock’s ability to outperform its sector and the Sensex, combined with a favourable upgrade in its Mojo Grade, underscores its attractiveness as a mid-cap IT stock with growth potential.

While short-term technical resistance remains, the overall market positioning suggests that investors and traders are gearing up for a positive phase. Monitoring open interest trends alongside price action will be crucial for gauging the sustainability of this momentum.

For investors seeking exposure to the Computers - Software & Consulting sector, Mphasis presents a compelling case backed by improving fundamentals, liquidity, and market sentiment. As always, a balanced approach considering both technical and fundamental factors will be key to capitalising on this opportunity.

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