Rs 1,050 Puts Draw 5,743 Contracts on One 97 Communications Ltd as Stock Trades Below Key Moving Averages

Put Options Event and Cash Market Context

On 27 Apr 2026, One 97 Communications Ltd witnessed heavy put option activity concentrated around the Rs 1,050 and Rs 1,060 strikes, with 5,743 and 4,744 contracts traded respectively for the 28 Apr 2026 expiry. The underlying stock price stood at Rs 1,071, placing these strikes approximately 1.9% (Rs 1,050) and 2.7% (Rs 1,060) out-of-the-money (OTM) relative to the current market price. Additionally, the Rs 1,000 strike, which is about 6.6% below the current price, saw 6,781 contracts traded, indicating notable interest further out-of-the-money.

The total turnover for these put trades was substantial, with Rs 891.44 lakhs at the Rs 1,050 strike and Rs 858.13 lakhs at Rs 1,060, signalling significant premium flow. Open interest (OI) at these strikes remains moderate, with 899 contracts at Rs 1,050 and 800 at Rs 1,060, suggesting a mix of fresh positions and some existing exposure adjustments. The Rs 1,000 strike has a higher OI of 1,642 contracts, indicating more established positions at this deeper strike.

The stock has underperformed its sector by 8.16% today and opened with a gap down of 5.44%, touching an intraday low of Rs 1,051.1, close to the Rs 1,050 put strike. Weighted average traded prices clustered near the day's low, reflecting selling pressure. The stock trades below all major moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring a bearish technical stance. Delivery volumes have risen modestly by 6.1% against the 5-day average, indicating increased investor participation despite the decline. Is this a capitulation phase or a prelude to further weakness?

Strike Price Analysis: Moneyness and Intent

The proximity of the Rs 1,050 and Rs 1,060 put strikes to the current price is a critical factor in interpreting the options activity. These strikes are near at-the-money (ATM) levels, with Rs 1,050 just about 1.9% below the underlying price. The Rs 1,000 strike, while further out-of-the-money, remains relevant given the volume and open interest.

ATM and slightly OTM puts bought in a falling market often signal directional bearish bets, as traders seek downside protection or outright profit from further declines. Conversely, if these puts were being sold (put writing), it would imply bullish conviction that the stock will not fall below these levels by expiry. However, the high turnover and relatively low open interest ratios suggest fresh buying rather than aggressive put writing.

Given the stock's recent weakness and trading below key moving averages, the strike distance supports the interpretation that these puts are primarily being purchased as a hedge or as a bearish directional position. The Rs 1,050 strike, close to the intraday low, may represent a technical support level where traders expect the stock to find a floor or alternatively a level to protect against further downside. Are these strikes signalling a protective floor or a bearish conviction?

Interpreting the Put Activity: Bearish, Hedging, or Put Writing?

Put option activity can be ambiguous, especially when the stock is volatile. The three main interpretations are: bearish positioning (put buying to profit from declines), hedging (protecting existing long positions), or put writing (selling puts to collect premium, implying bullishness).

In this case, the stock has been falling sharply for four days, trading below all major moving averages, and the put strikes are ATM to slightly OTM. This context strongly suggests that the put buying is predominantly bearish or protective hedging rather than put writing. The relatively low open interest compared to contracts traded indicates fresh positioning, consistent with traders either initiating bearish bets or adding downside protection.

Put writing typically involves strikes further out-of-the-money with high open interest and premium collection, which is less evident here. The Rs 1,000 strike, while deeper OTM, has higher open interest but lower turnover relative to the nearer strikes, suggesting it may represent existing positions rather than new put writing activity.

Open Interest and Contracts Analysis

The ratio of contracts traded to open interest provides insight into whether the activity reflects fresh positioning or adjustments to existing positions. At the Rs 1,050 strike, 5,743 contracts traded against an OI of 899, a ratio of approximately 6.4:1, indicating significant new activity. Similarly, the Rs 1,060 strike shows a ratio of about 5.9:1 (4,744 contracts traded vs 800 OI).

These elevated ratios suggest that traders are actively initiating new put positions rather than merely rolling or closing old ones. The Rs 1,000 strike has a lower ratio of roughly 4.1:1, implying a mix of fresh and existing positions. This pattern supports the view that the bulk of the recent put activity is directional or hedging in nature rather than put writing, which would typically show higher OI relative to turnover.

Cash Market Context: Technical Weakness and Delivery Volumes

One 97 Communications Ltd has been under pressure, falling 7.28% on the day and underperforming its sector by over 8%. The stock trades below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, signalling a bearish technical setup. The intraday low of Rs 1,051.1 is close to the Rs 1,050 put strike, suggesting that traders may be using this level as a reference point for downside protection.

Delivery volumes have risen by 6.1% compared to the 5-day average, with 5.32 lakh shares delivered on 24 Apr, indicating that the decline is accompanied by genuine investor participation rather than purely speculative selling. However, the weighted average price traded near the day's low hints at sustained selling pressure. Does this technical and volume pattern confirm a bearish outlook or a potential support zone?

Conclusion: Protective Hedging and Bearish Positioning Dominate

The put option activity in One 97 Communications Ltd around the Rs 1,050 and Rs 1,060 strikes, combined with the stock's technical weakness and rising delivery volumes, points to a market positioning that is largely defensive or bearish. The proximity of the strikes to the current price and the fresh nature of the contracts traded suggest that traders are either hedging existing long exposure or initiating bearish bets anticipating further declines.

Put writing as a bullish strategy appears less likely given the turnover and open interest patterns. The stock's fall below all major moving averages and the clustering of put activity near recent lows reinforce the interpretation of cautious or negative sentiment prevailing in the options market.

For investors and traders, should this put activity prompt a reassessment of risk exposure in One 97 Communications Ltd?

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