Supreme Industries Ltd Sees Sharp Open Interest Surge Amid Mixed Market Signals

Open Interest and Volume Dynamics

On 10 Feb 2026, Supreme Industries Ltd (NSE: SUPREMEIND) recorded an open interest (OI) of 17,780 contracts, up from 15,365 the previous day, marking an increase of 2,415 contracts or 15.72%. This rise in OI was accompanied by a total volume of 22,312 contracts, indicating robust trading activity in the derivatives market. The futures segment alone accounted for a value of approximately ₹12,856.7 lakhs, while options contributed a staggering ₹13,876.8 crores in notional value, culminating in a combined derivatives turnover of ₹14,720.1 lakhs.

The underlying stock price closed at ₹3,718, having touched an intraday high of ₹3,823.2, a 3.19% spike during the session. Notably, the stock has been on a two-day consecutive gain streak, delivering a cumulative return of 1.09%. However, it marginally underperformed its sector, which rose 0.75%, and the broader Sensex, which gained 0.33% on the same day.

Market Positioning and Technical Context

Supreme Industries’ price currently trades above its 5-day, 20-day, and 50-day moving averages but remains below the longer-term 100-day and 200-day averages. This technical setup suggests short-term bullish momentum amid longer-term consolidation or resistance. The delivery volume on 9 Feb was 1.58 lakh shares, up 6.26% compared to the five-day average, signalling rising investor participation and confidence in the stock’s near-term prospects.

Liquidity remains adequate, with the stock’s average traded value supporting a trade size of approximately ₹2.19 crore based on 2% of the five-day average traded value. This liquidity profile ensures that institutional and retail investors can execute sizeable trades without significant market impact.

Interpreting the Open Interest Surge

The 15.7% increase in open interest is a significant development, often interpreted as fresh capital entering the market or existing positions being rolled over. In Supreme Industries’ case, the rise in OI alongside a modest price increase suggests that traders are building new positions rather than closing out existing ones. This can be indicative of a directional bet, with participants possibly anticipating further upside or hedging against volatility.

However, the mixed signals from price action and sector underperformance imply caution. The stock’s outperformance relative to the Sensex but slight lag behind its sector peers points to selective interest rather than broad-based enthusiasm. The fact that the stock remains below its 100-day and 200-day moving averages also tempers the bullish narrative, highlighting potential resistance levels that could cap gains in the near term.

Mojo Score and Analyst Ratings

Supreme Industries currently holds a Mojo Score of 34.0, categorised as a Sell rating, downgraded from Hold on 23 Oct 2025. This downgrade reflects concerns over valuation, earnings momentum, or sectoral headwinds. The Market Cap Grade stands at 2, indicating mid-cap status with moderate liquidity and market presence. Investors should weigh these fundamental assessments alongside technical and derivatives market signals before making allocation decisions.

Sector and Industry Context

Operating within the Plastic Products - Industrial sector, Supreme Industries faces cyclical demand patterns influenced by raw material costs, industrial activity, and end-user consumption trends. The sector has shown resilience but remains sensitive to commodity price fluctuations and regulatory developments. The recent derivatives activity may be a response to anticipated sectoral shifts or company-specific news, though no explicit catalysts have been reported as of 10 Feb 2026.

Potential Directional Bets and Investor Strategies

The surge in open interest combined with rising volume and delivery participation suggests that market participants are positioning for a directional move. Given the stock’s recent gains and technical positioning, bullish bets may be favoured, especially in the near term. However, the cautious analyst stance and resistance at longer-term moving averages imply that risk management remains crucial.

Options market data, with a substantial notional value of ₹13,876.8 crores, indicates active hedging and speculative activity. Traders might be employing strategies such as long calls or protective puts to capitalise on expected volatility or to safeguard existing holdings. The balance between futures and options turnover also points to a nuanced market view, blending outright directional exposure with risk mitigation.

Conclusion: Balanced Outlook Amid Heightened Activity

Supreme Industries Ltd’s recent open interest surge highlights increased market engagement and evolving investor sentiment. While the derivatives data points to fresh positioning and potential bullish bets, the broader technical and fundamental context advises caution. The stock’s mid-cap status, sector dynamics, and recent Mojo downgrade underscore the need for a measured approach.

Investors should monitor upcoming earnings, sector developments, and price action around key moving averages to better gauge the sustainability of current momentum. The interplay between futures and options volumes will also provide valuable clues on market expectations and risk appetite.

In summary, Supreme Industries presents a compelling case study of how derivatives market activity can offer early signals of shifting market sentiment, but must be analysed alongside comprehensive fundamental and technical factors to inform prudent investment decisions.

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