Call Option Activity Highlights
On 30 January 2026, TCS emerged as the most active stock in call options trading, with 7,222 contracts exchanged at the ₹3,300 strike price. This activity generated a turnover of ₹16.32 crores, reflecting significant investor interest in bullish bets on the stock. Open interest remains robust at 5,979 contracts, indicating sustained positions rather than short-term speculative trades.
The underlying stock price stood at ₹3,115.30, meaning the ₹3,300 strike is approximately 5.9% out of the money. The expiry date of 24 February 2026 provides investors with nearly a month to capitalise on potential upward price movements, suggesting confidence in a rebound or positive developments within this timeframe.
Price Performance and Technical Context
Despite the bullish positioning in options, TCS’s spot price has been under pressure. The stock has declined by 0.86% on the day, underperforming the Sensex’s 0.48% fall but outperforming its sector’s 1.17% drop. Over the last two trading sessions, TCS has lost 2.62%, reflecting a short-term bearish trend.
Technically, the stock is trading below all key moving averages — 5-day, 20-day, 50-day, 100-day, and 200-day — signalling a sustained downtrend. This technical weakness contrasts with the elevated call option activity, suggesting that some investors are anticipating a turnaround or are hedging existing positions.
Investor participation has also waned, with delivery volume on 29 January falling by 18.7% to 15.31 lakh shares compared to the five-day average. This decline in delivery volume may indicate reduced conviction among long-term holders amid the recent price softness.
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Fundamental and Market Positioning
TCS remains a large-cap stalwart with a market capitalisation of ₹11,25,406 crores, underscoring its dominant position in the Indian IT services industry. The company currently holds a Mojo Score of 57.0, reflecting a Hold rating, an upgrade from a Sell grade on 22 April 2025. This improvement suggests a stabilising outlook, although the stock has yet to demonstrate a decisive uptrend.
The stock offers a relatively attractive dividend yield of 3.46%, which may appeal to income-focused investors amid market volatility. Liquidity remains strong, with the stock capable of supporting trade sizes up to ₹18.42 crores based on 2% of the five-day average traded value, ensuring ease of entry and exit for institutional participants.
Investor Sentiment and Expiry Dynamics
The concentration of call option activity at the ₹3,300 strike price, which is out of the money by nearly 6%, indicates a cautiously optimistic stance among traders. The open interest of 5,979 contracts suggests that many investors are holding these positions, possibly anticipating positive earnings results, contract wins, or sector tailwinds in the near term.
Given the expiry date of 24 February 2026, market participants have a window of approximately three weeks to see these expectations materialise. The elevated turnover in call options relative to the underlying stock’s recent weakness may also reflect hedging strategies or speculative plays on volatility.
Sector and Broader Market Context
The Computers - Software & Consulting sector has experienced mixed performance recently, with TCS outperforming its peers marginally on the day despite its own price decline. This relative resilience may be underpinning the bullish option positioning, as investors seek exposure to a leading IT services provider amid ongoing digital transformation trends.
However, the stock’s failure to hold above key moving averages and the decline in delivery volumes highlight caution among longer-term investors. The juxtaposition of technical weakness and strong call option interest suggests a market divided between short-term bearishness and longer-term optimism.
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Outlook and Investor Takeaways
Investors monitoring TCS should weigh the contrasting signals from the options market and the underlying stock’s technicals. The surge in call option contracts at a strike price above the current market level suggests that some market participants expect a rebound or positive news flow within the next few weeks.
However, the stock’s recent price weakness, trading below all major moving averages, and declining delivery volumes indicate that caution remains warranted. The Hold rating and Mojo Score of 57.0 reflect this balanced view, neither strongly bullish nor bearish.
For investors considering exposure, the relatively high dividend yield offers some cushion, while the liquidity profile supports active trading strategies. Those inclined towards options may find the current elevated call activity an opportunity to participate in potential upside, but should remain mindful of the risks given the prevailing downtrend.
Overall, Tata Consultancy Services Ltd. remains a key bellwether in the IT sector, with its option market activity providing valuable insights into evolving investor sentiment ahead of the February expiry.
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