Reliance Industries Sees Heavy Put Option Activity Amid Bearish Sentiment

Put Option Surge Highlights Investor Caution

On 14 January 2026, Reliance Industries Ltd (NSE: RELIANCE) emerged as the most active stock in put options trading, with 3,743 contracts exchanged at the ₹1,450 strike price expiring on 27 January 2026. This activity generated a turnover of approximately ₹44.69 crores, reflecting substantial investor interest in downside protection or speculative bearish bets. The open interest for these puts stands at 5,484 contracts, underscoring a sustained build-up of bearish sentiment or hedging strategies.

The underlying stock price was ₹1,460.9 at the time, just above the strike price, indicating that traders are positioning for a possible near-term correction or volatility. Such concentrated put buying often suggests that market participants are either seeking insurance against a decline or anticipating a pullback in the stock’s price.

Stock Performance and Technical Context

Reliance Industries’ stock price movement on the day was largely in line with its sector peers, registering a modest gain of 0.61%, slightly below the sector’s 0.77% rise but outperforming the Sensex, which declined by 0.09%. The stock remains above its 200-day moving average, a long-term bullish indicator, but trades below its 5-day, 20-day, 50-day, and 100-day moving averages, signalling short- to medium-term weakness or consolidation.

Investor participation has shown signs of waning, with delivery volumes on 13 January falling by 30.72% compared to the five-day average, suggesting reduced conviction among buyers. Despite this, liquidity remains robust, with the stock’s traded value supporting sizeable trades up to ₹37.05 crores comfortably, ensuring that option and stock market activity can continue without significant price impact.

Mojo Score and Analyst Ratings

MarketsMOJO assigns Reliance Industries a Mojo Score of 62.0, categorising it as a ‘Hold’ with a recent downgrade from ‘Buy’ on 6 January 2026. This reflects a cautious stance amid mixed technical signals and evolving market conditions. The company’s market capitalisation remains substantial at ₹19,65,388 crores, firmly placing it in the large-cap segment with a Market Cap Grade of 1, indicating top-tier size and liquidity.

Expiry Patterns and Market Implications

The expiry date of 27 January 2026 is critical as it marks the end of the current monthly options cycle. The concentration of put options at ₹1,450, just below the current market price, suggests a key support level that traders are watching closely. Should the stock breach this level, it could trigger further downside momentum, amplified by the unwinding of hedges or speculative positions.

Conversely, if Reliance Industries maintains or rallies above this strike price, the put option holders may face losses, potentially leading to a short squeeze or increased call option activity. The interplay between these option positions and the underlying stock price will be pivotal in shaping near-term price action.

Bearish Positioning or Strategic Hedging?

Heavy put option activity can stem from two primary motivations: outright bearish bets or protective hedging. Given Reliance Industries’ stature as a large-cap oil sector leader, many institutional investors may be using puts to hedge existing long stock positions against sectoral or macroeconomic risks, such as fluctuating crude oil prices or regulatory changes.

However, the downgrade in Mojo Grade from ‘Buy’ to ‘Hold’ and the stock’s technical positioning below several moving averages lend credence to the view that some market participants are positioning for a potential correction. The relatively high open interest and turnover in puts at this strike price reinforce the notion of cautious sentiment prevailing among traders.

Sectoral Context and Broader Market Trends

The oil sector has experienced mixed fortunes recently, with global crude prices exhibiting volatility amid geopolitical tensions and shifting demand forecasts. Reliance Industries, as a diversified conglomerate with significant oil and petrochemical operations, remains sensitive to these dynamics. The sector’s 0.77% gain on the day contrasts with the broader market’s slight decline, highlighting selective strength but also underlying uncertainty.

Investors are advised to monitor option market activity closely as it often provides early signals of changing sentiment. The current put option surge in Reliance Industries could presage increased volatility or a shift in trend, warranting careful risk management.

Investor Takeaways and Outlook

For investors holding Reliance Industries shares, the current surge in put option activity signals a need for vigilance. While the company’s fundamentals remain robust, the technical indicators and option market positioning suggest that downside risks cannot be discounted in the near term. Investors may consider protective strategies such as stop-loss orders or option hedges to mitigate potential volatility.

Meanwhile, traders looking to capitalise on volatility might explore put options at the ₹1,450 strike price or nearby strikes, depending on their risk appetite and market view. The expiry on 27 January 2026 will be a key event, with price action around this date likely to set the tone for the stock’s trajectory in the following weeks.

Overall, Reliance Industries remains a heavyweight in the Indian equity market, but the evolving option market dynamics underscore the importance of a nuanced approach that balances fundamental strength with technical caution.

Conclusion

The pronounced put option activity in Reliance Industries ahead of the January expiry highlights a growing bearish or hedging sentiment among investors. With the stock hovering near the ₹1,450 strike price and trading below several moving averages, the market is signalling caution despite the company’s large-cap stature and solid fundamentals. Investors and traders alike should monitor developments closely, as option market trends often presage shifts in underlying stock momentum.

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