Swiggy Ltd Sees Surge in Put Option Activity Amid Bearish Market Sentiment

Swiggy’s Market Performance and Current Valuation

Swiggy Ltd, currently trading at ₹307.15, is hovering just 3.02% above its 52-week low of ₹297, reflecting sustained pressure on the stock. The company’s market capitalisation stands at a robust ₹90,373 crores, categorising it as a mid-cap stock within the E-Retail and E-Commerce industry. Despite this sizeable valuation, the stock has underperformed its sector by 5.11% on 29 January 2026, closing the day with a sharp 6.30% decline compared to the sector’s modest 1.24% fall and the Sensex’s 0.48% drop.

Swiggy’s price action has been notably weak, with the stock opening down 5.69% and touching an intraday low of ₹302.15, marking a 7.78% drop during the session. The weighted average price of traded volumes skewed towards the lower end of the day’s range, indicating selling pressure. Furthermore, the stock is trading below all major moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — underscoring a bearish technical setup.

Put Option Activity Highlights Bearish Positioning

The most active put options for Swiggy are concentrated at the ₹300 strike price, expiring on 24 February 2026. On this expiry date, a substantial 3,574 contracts were traded, generating a turnover of ₹570.09 lakhs. Open interest at this strike stands at 1,591 contracts, signalling that a significant number of investors are either hedging existing long positions or speculating on further downside.

This heavy put option volume near the ₹300 strike price, which is just below the current market price, suggests that traders are positioning for a potential decline below this psychological support level. The proximity of the strike to the stock’s 52-week low further emphasises the cautious outlook prevailing among market participants.

Expiry Patterns and Investor Sentiment

Options expiry on 24 February 2026 is shaping up as a critical juncture for Swiggy. The concentration of put contracts at the ₹300 strike indicates that investors are bracing for volatility and possible downside risk in the near term. This pattern is consistent with a broader trend of falling investor participation, as delivery volumes on 29 January plummeted by 71.42% compared to the five-day average, signalling reduced conviction among buyers.

Liquidity remains adequate for sizeable trades, with the stock’s daily traded value supporting transactions up to ₹10.64 crores based on 2% of the five-day average traded value. This liquidity ensures that the active put option market is reflective of genuine hedging and speculative activity rather than illiquid distortions.

Mojo Score and Analyst Ratings Reflect Deteriorating Outlook

Swiggy’s current Mojo Score stands at a low 29.0, with a Mojo Grade of Strong Sell as of 4 December 2025, a downgrade from the previous Sell rating. This downgrade reflects deteriorating fundamentals and technical weakness, reinforcing the bearish sentiment evident in the options market. The company’s market cap grade is a modest 2, indicating limited strength relative to peers.

Such a rating shift often prompts institutional investors and traders to adopt protective strategies, including buying put options to hedge downside risk or to speculate on further price declines. The alignment of the Mojo Grade with the heavy put option activity underscores the consensus of caution surrounding Swiggy’s near-term prospects.

Sector and Market Context

The E-Retail and E-Commerce sector has experienced mixed performance recently, with some stocks showing resilience while others face headwinds from inflationary pressures and changing consumer behaviour. Swiggy’s underperformance relative to its sector peers by over 5% on the day highlights company-specific challenges, possibly related to competitive pressures or earnings concerns.

Compared to the broader market, Swiggy’s 6.30% decline is stark, especially against the Sensex’s modest 0.48% fall. This divergence suggests that investors are selectively reducing exposure to Swiggy, favouring either safer or more fundamentally robust stocks within the sector.

Implications for Investors and Traders

For investors, the heavy put option activity at the ₹300 strike price and the stock’s technical weakness signal a need for caution. Those holding long positions may consider protective hedging strategies, such as purchasing puts or tightening stop-loss levels, to mitigate potential losses if the stock breaches key support levels.

Traders looking to capitalise on volatility might find opportunities in the options market, given the elevated open interest and turnover. However, the strong bearish bias suggests that bullish strategies should be approached with prudence until a clear reversal or fundamental improvement emerges.

Outlook and Conclusion

Swiggy Ltd’s current market dynamics, characterised by heavy put option volumes, a strong sell Mojo Grade, and technical weakness, point to a cautious near-term outlook. The stock’s proximity to its 52-week low and the concentration of bearish bets at the ₹300 strike price ahead of the 24 February expiry suggest that investors are bracing for further downside risk.

While the company remains a significant player in the E-Retail and E-Commerce sector, the prevailing market sentiment and technical indicators advise prudence. Investors should closely monitor price action around key support levels and consider hedging strategies to protect portfolios against potential declines. Meanwhile, traders may find opportunities in the options market but must remain vigilant to the risks inherent in a bearish environment.

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