Key Events This Week
23 Feb: Significant open interest surge amid steady price gains (Rs.1,732.20)
24 Feb: Further open interest increase and bullish market positioning (Rs.1,730.55)
24 Feb: MarketsMOJO upgrades rating to Buy on strong fundamentals and technicals
27 Feb: Week closes at Rs.1,738.10, outperforming Sensex
23 February 2026: Open Interest Surge Signals Growing Market Engagement
On 23 February, Sun Pharmaceutical’s stock price rose modestly by 0.45% to close at Rs.1,732.20, slightly outperforming the Sensex gain of 0.39%. The day was notable for an 11.74% increase in open interest in the derivatives segment, rising to 1,46,624 contracts from 1,31,217 the previous day. This surge, alongside a volume of 80,340 contracts, indicated fresh positions being established rather than liquidation, reflecting increased market participation.
The futures segment accounted for a notional value of approximately ₹1,76,091 lakhs, while options contributed ₹31,044 crores, underscoring robust liquidity. Technically, the stock traded above all key moving averages, signalling a sustained bullish trend. Delivery volumes also rose by 20.21% compared to the five-day average, suggesting genuine accumulation by investors.
24 February 2026: Continued Open Interest Growth and Rating Upgrade
Despite a slight dip in stock price by 0.10% to Rs.1,730.55 on 24 February, Sun Pharma outperformed the Sensex, which declined by 0.78%. Open interest in derivatives surged further by 13.46% to 1,49,669 contracts, accompanied by a volume of 76,868 contracts. The futures segment’s notional value rose to ₹2,06,134 lakhs, with options at ₹26,15,737 lakhs, reflecting heightened investor interest and active options strategies.
MarketsMOJO upgraded Sun Pharmaceutical’s rating from Hold to Buy on 23 February, citing strong fundamentals including a low debt profile, a robust 15.21% return on equity, and healthy long-term growth with net sales expanding at 11.37% annually. The upgrade also highlighted the stock’s technical shift to a mildly bullish momentum, supported by positive moving averages and improved quarterly performance.
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25 & 26 February 2026: Price Gains Amid Sector Resilience
On 25 February, the stock rebounded strongly, gaining 1.92% to close at Rs.1,763.80, outperforming the Sensex’s 0.41% rise. This upward momentum continued on 26 February with a 1.18% gain to Rs.1,784.60, marking the week’s highest close. These gains coincided with the stock maintaining its position above all key moving averages, reinforcing the technical strength noted earlier in the week.
Volume remained moderate, with 63,596 shares traded on 25 February and 78,605 on 26 February, supporting the price appreciation. The pharmaceutical sector’s steady demand and innovation pipeline likely contributed to the positive sentiment, as the stock outperformed the broader market during these sessions.
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27 February 2026: Profit Taking Leads to Price Correction
The final trading day saw a sharp correction with the stock falling 2.61% to close at Rs.1,738.10, while the Sensex declined 1.16%. This pullback followed two consecutive days of gains and may reflect profit-taking amid broader market volatility. Despite the decline, Sun Pharma ended the week with a net gain and outperformed the Sensex’s weekly loss of 0.96%.
Volume on 27 February was relatively low at 37,974 shares, suggesting limited selling pressure. The stock’s ability to maintain a close above Rs.1,730 after the dip indicates underlying support and resilience in the face of market fluctuations.
| Date | Stock Price | Day Change | Sensex | Day Change |
|---|---|---|---|---|
| 2026-02-23 | Rs.1,732.20 | +0.45% | 36,817.86 | +0.39% |
| 2026-02-24 | Rs.1,730.55 | -0.10% | 36,530.09 | -0.78% |
| 2026-02-25 | Rs.1,763.80 | +1.92% | 36,679.75 | +0.41% |
| 2026-02-26 | Rs.1,784.60 | +1.18% | 36,748.49 | +0.19% |
| 2026-02-27 | Rs.1,738.10 | -2.61% | 36,322.56 | -1.16% |
Key Takeaways
Positive Signals: The week’s open interest surges on 23 and 24 February indicate strong market engagement and fresh positioning in Sun Pharma’s derivatives, supporting a bullish technical outlook. The upgrade to a Buy rating by MarketsMOJO on 23 February reflects improved fundamentals, including robust return on equity, healthy sales growth, and strong quarterly performance. The stock’s ability to outperform the Sensex by 1.75% over the week despite market volatility underscores its defensive qualities within the pharmaceutical sector.
Cautionary Notes: The sharp price decline on 27 February highlights potential short-term volatility and profit-taking risks. Elevated valuation metrics such as a Price to Book ratio of 5.3 and a high PEG ratio of 11.6 suggest limited room for multiple expansion, warranting careful monitoring. Mixed technical signals, including mildly bearish MACD and KST indicators, counsel prudence despite the overall bullish momentum.
Conclusion
Sun Pharmaceutical Industries Ltd demonstrated resilience and modest gains during the week ending 27 February 2026, supported by significant derivatives market activity and a favourable upgrade in investment rating. The stock’s technical positioning above key moving averages and strong fundamentals provide a constructive backdrop, while the recent volatility reminds investors of the inherent risks in the pharmaceutical sector. Overall, the week’s developments suggest a cautiously optimistic outlook, with market participants closely watching derivatives positioning and broader sector trends for further direction.
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