Persistent Systems Sees Heavy Put Option Activity Amid Bearish Sentiment

Put Option Activity Highlights Persistent’s Downward Pressure

On 12 February 2026, Persistent Systems Ltd (NSE: PERSISTENT) emerged as one of the most actively traded stocks in the put options segment. The most active put option contract was at a strike price of ₹5,500, with 4,252 contracts changing hands, generating a turnover of ₹7.08 crores. Open interest for this strike stands at 1,032 contracts, indicating sustained interest in downside protection or speculative bearish bets.

The underlying stock price was ₹5,480.5 at the time, just below the ₹5,500 strike, suggesting that traders are positioning for a potential further decline or at least hedging against downside risk. The concentration of volume near the lower end of the day’s trading range, coupled with a weighted average price closer to the intraday low of ₹5,450, reinforces the bearish undertone.

Recent Price Performance and Technical Weakness

Persistent Systems has been on a downward trajectory, losing 6.87% over the past three trading days. On 12 February, the stock declined by 3.82%, underperforming the IT - Software sector, which itself fell by 3.73%. The Sensex was relatively resilient, dropping only 0.45% on the same day. Persistent’s intraday low of ₹5,450 marked a 4.79% fall from the previous close, with the stock trading below all key moving averages – 5-day, 20-day, 50-day, 100-day, and 200-day – signalling a bearish technical setup.

Investor participation has increased notably, with delivery volumes rising to 8.29 lakh shares on 11 February, a 57.9% increase compared to the five-day average. This heightened activity suggests that investors are either liquidating positions or actively hedging amid uncertainty.

Mojo Score and Analyst Ratings Reflect Caution

Persistent Systems currently holds a Mojo Score of 61.0, placing it in the 'Hold' category, a downgrade from its previous 'Buy' rating as of 5 February 2026. The market cap grade is 2, reflecting its mid-cap status with a market capitalisation of approximately ₹90,212 crores. This rating adjustment aligns with the recent price weakness and increased put option activity, signalling a more cautious stance among analysts and investors alike.

The downgrade suggests that while the company maintains solid fundamentals in the software and consulting space, near-term headwinds and sectoral pressures are weighing on sentiment. The IT - Software sector has broadly declined, and Persistent’s relative underperformance indicates it is more vulnerable to current market dynamics.

Expiry Patterns and Implications for February 2026

The 24 February 2026 expiry date for the active put options is a critical near-term event. The high volume and open interest at the ₹5,500 strike price imply that traders are either hedging existing long positions or speculating on a further decline below this level. Given the stock’s current trading below all major moving averages and recent consecutive losses, the probability of the stock closing below ₹5,500 at expiry appears elevated.

Such positioning often precedes increased volatility as expiry approaches, with traders adjusting their hedges or unwinding bearish bets depending on price action. Investors should monitor open interest changes and volume shifts closely in the coming days to gauge market sentiment and potential price direction.

Sectoral Context and Broader Market Impact

Persistent Systems’ performance must be viewed within the broader IT - Software sector context, which has declined by 3.73% on the day. The sector’s weakness is driven by a combination of global macroeconomic concerns, including tightening monetary policies and subdued technology spending forecasts. Persistent’s sharper decline relative to its peers suggests company-specific factors or investor concerns may be amplifying the bearish sentiment.

Despite the sectoral downturn, the Sensex’s modest 0.45% fall indicates that the broader market remains relatively stable. This divergence highlights the selective pressure on IT mid-caps like Persistent, which may face more pronounced volatility and investor scrutiny.

Investor Takeaways and Strategic Considerations

For investors holding Persistent Systems shares, the surge in put option activity and recent price weakness suggest a cautious approach is warranted. The stock’s technical indicators point to continued downside risk in the near term, especially with expiry looming on 24 February 2026. Hedging strategies using put options at the ₹5,500 strike price appear popular, reflecting concerns about further declines.

Long-term investors should weigh the company’s fundamental strengths against the current market volatility and sectoral headwinds. The downgrade to a 'Hold' rating by MarketsMOJO indicates that while the stock is not a sell, it may not offer immediate upside potential until clearer signs of recovery emerge.

Traders might consider monitoring open interest and volume trends in the options market as a barometer of sentiment shifts. A sustained decrease in put option open interest coupled with price stabilisation above key moving averages could signal a reversal in bearish positioning.

Conversely, if put volumes and open interest continue to rise, it may indicate growing pessimism and potential for further downside, warranting defensive positioning or profit-taking.

Conclusion

Persistent Systems Ltd’s recent market activity, characterised by heavy put option trading at the ₹5,500 strike and a series of price declines, underscores a cautious investor outlook. The stock’s underperformance relative to its sector and the broader market, combined with technical weakness and a Mojo Score downgrade, suggests that bearish sentiment is currently dominant. Investors should remain vigilant of expiry dynamics and sector trends while considering appropriate risk management strategies.

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