Open Interest and Volume Dynamics
On 7 January 2026, Polycab’s open interest (OI) in futures and options contracts rose sharply by 3,467 contracts, a 10.55% increase from the previous day’s 32,847 to 36,314. This rise in OI accompanied a volume of 29,078 contracts, indicating fresh positions being established rather than existing ones being squared off. The futures value stood at ₹51,113.55 lakhs, while the options segment exhibited a substantial notional value of approximately ₹24,337.54 crores, culminating in a total derivatives value of ₹55,930.15 lakhs. The underlying stock price at the time was ₹7,854.
This combination of rising OI and sustained volume typically reflects growing conviction among traders, often interpreted as a precursor to a sustained price trend. The increase in OI alongside a price rise suggests that market participants are predominantly taking long positions, betting on further upside.
Price Performance and Technical Indicators
Polycab India Ltd has outperformed its sector by 1.21% on the day, registering a 0.63% gain compared to the sector’s decline of 0.40% and the Sensex’s fall of 0.31%. The stock has been on a two-day winning streak, delivering a cumulative return of 1.32%. It is trading comfortably above its key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a strong bullish trend and healthy momentum.
Despite the positive price action, delivery volumes have declined by 21.08% to 2.19 lakh shares on 6 January, compared to the five-day average. This drop in delivery volume suggests that short-term traders and derivatives players are driving the recent price moves rather than long-term investors. However, liquidity remains adequate, with the stock’s average traded value supporting trade sizes up to ₹6.52 crore, ensuring smooth execution for institutional participants.
Market Positioning and Sentiment
The surge in open interest combined with rising prices and volume points to a bullish market stance on Polycab. The stock’s Mojo Score has improved to 71.0, upgrading its Mojo Grade from Hold to Buy as of 21 July 2025. This upgrade reflects enhanced fundamentals and technical strength, supported by a market capitalisation of ₹1,18,097.43 crore, categorising it as a mid-cap stock within the cables and electricals sector.
Investors appear to be positioning for continued growth, possibly anticipating strong earnings or sectoral tailwinds. The cables and electricals industry has been benefiting from infrastructure development and increased electrification projects, which could be underpinning positive sentiment towards Polycab.
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Derivative Market Implications
The derivatives market activity in Polycab suggests that traders are increasingly confident in the stock’s upward trajectory. The 10.55% jump in open interest is significant, especially when paired with a price rise and strong volume, indicating fresh long positions rather than profit-taking or short covering.
Options data, with an enormous notional value exceeding ₹24,000 crore, highlights active hedging and speculative interest. The futures value of over ₹51,000 lakhs further confirms institutional participation. This positioning could be reflective of expectations for positive quarterly results or favourable sector developments.
Comparative Sector and Market Context
While Polycab has outperformed its sector and the Sensex on the day, the broader market has shown some weakness. This relative strength is noteworthy and may attract further investor interest. The cables and electricals sector, integral to India’s infrastructure growth story, remains a key beneficiary of government initiatives and rising demand for electrical components.
Polycab’s sustained gains above all major moving averages reinforce its technical resilience, making it a preferred pick among mid-cap stocks in the sector. The upgrade in Mojo Grade to Buy further validates this stance, signalling improved quality and growth prospects.
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Outlook and Investor Considerations
Given the current market positioning and technical strength, Polycab India Ltd appears poised for further gains in the near term. The open interest surge in derivatives signals that traders are placing directional bets on continued upside, supported by strong fundamentals and sectoral tailwinds.
However, investors should remain mindful of the recent decline in delivery volumes, which may indicate some caution among long-term holders. Monitoring quarterly earnings and sector developments will be crucial to validate the sustainability of this momentum.
Overall, Polycab’s upgraded Mojo Grade to Buy, combined with its market cap strength and technical indicators, makes it an attractive candidate for investors seeking exposure to the cables and electricals sector’s growth story.
Summary
Polycab India Ltd’s recent surge in open interest by over 10% alongside rising prices and volume reflects a bullish market stance. The stock’s outperformance relative to its sector and the Sensex, coupled with its trading above all key moving averages, underscores strong momentum. Institutional participation in derivatives is robust, with futures and options values indicating significant positioning. While delivery volumes have dipped, the overall outlook remains positive, supported by an upgraded Mojo Grade of Buy and a market capitalisation exceeding ₹1.18 lakh crore. Investors should watch for upcoming earnings and sector trends to confirm this bullish trajectory.
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