Open Interest and Volume Dynamics
On 23 Feb 2026, TVS Motor Company Ltd (symbol: TVSMOTOR) recorded an open interest of 92,091 contracts, up from 80,038 the previous session, marking a robust increase of 12,053 contracts or 15.06%. This rise in OI is accompanied by a daily volume of 38,523 contracts, indicating strong participation in the derivatives market. The futures segment alone accounted for a notional value of approximately ₹1,34,703.86 lakhs, while options contributed a staggering ₹12,76,26,693.04 lakhs, culminating in a total derivatives value of ₹1,36,002.22 lakhs.
Such a pronounced increase in open interest alongside elevated volumes typically signals fresh capital inflows and new positions being established, rather than mere unwinding of existing trades. This pattern often precedes directional moves in the underlying stock, as market participants position themselves for anticipated price changes.
Price Action and Technical Context
TVS Motor’s underlying stock price closed at ₹3,844, just 1.84% shy of its 52-week high of ₹3,909. The stock has rebounded after two consecutive days of decline, touching an intraday high of ₹3,894.80, a gain of 2.06% on the day. Notably, the price remains above its 20-day, 50-day, 100-day, and 200-day moving averages, though it trades slightly below the 5-day moving average, indicating short-term consolidation within a longer-term uptrend.
Investor participation is also on the rise, with delivery volumes on 20 Feb reaching 2.35 lakh shares, a 39.6% increase compared to the five-day average. This suggests that the recent price strength is supported by genuine buying interest rather than speculative intraday activity.
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Market Positioning and Directional Bets
The surge in open interest, particularly in the futures and options segments, indicates that traders are actively positioning for a directional move. Given the stock’s proximity to its 52-week high and the recent price recovery, the bias appears to be bullish. The increase in OI alongside rising prices typically reflects fresh long positions being built rather than short covering.
Moreover, the substantial notional value in options suggests that market participants are employing a variety of strategies, including calls and puts, to hedge or leverage their views. The large options value relative to futures points to active hedging or speculative activity, which could amplify volatility in the near term.
Fundamental and Technical Ratings
TVS Motor Company Ltd holds a strong Market Capitalisation Grade of 1, reflecting its status as a large-cap stock with a market cap of ₹1,82,428.70 crores. The company’s Mojo Score stands at 78.0, upgraded from a previous Hold rating to a Buy on 6 Nov 2025, signalling improved fundamentals and positive outlook. This upgrade aligns with the recent price momentum and increased investor interest.
On the technical front, the stock’s position above key moving averages supports the bullish thesis, while the slight dip below the 5-day average suggests a short-term pause or consolidation. The stock’s 1-day return of 0.62% outperformed the sector’s 0.58% and the Sensex’s 0.40%, underscoring relative strength within the automobile sector.
Liquidity and Trading Considerations
Liquidity remains robust, with the stock’s traded value supporting a trade size of approximately ₹2.61 crores based on 2% of the five-day average traded value. This ensures that institutional and retail investors can execute sizeable trades without significant market impact, an important factor for derivatives traders looking to establish or exit positions efficiently.
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Implications for Investors
The marked increase in open interest and volume in TVS Motor’s derivatives signals a growing conviction among market participants about the stock’s near-term prospects. Investors should note the alignment of technical strength, improving fundamental ratings, and rising investor participation as positive indicators.
However, the proximity to the 52-week high and the slight short-term consolidation below the 5-day moving average suggest that some caution is warranted. Profit booking or volatility spikes could occur as traders adjust positions. Monitoring open interest trends alongside price action will be crucial to gauge whether the bullish momentum sustains or reverses.
Sector and Market Context
Within the automobile sector, TVS Motor’s performance is inline with sectoral gains, outperforming the broader Sensex. The sector’s steady recovery and demand outlook for two-wheelers and electric vehicles provide a supportive backdrop for the stock. The company’s large-cap status and strong market cap grade further enhance its appeal as a core portfolio holding.
Overall, the derivatives market activity in TVS Motor Company Ltd reflects a strategic build-up of bullish positions, supported by solid fundamentals and technical momentum. Investors and traders should watch for continued open interest growth and price confirmation to validate the emerging trend.
Conclusion
TVS Motor Company Ltd’s recent surge in open interest and volume in the derivatives market underscores a significant shift in market positioning towards a bullish outlook. The stock’s technical strength, upgraded Mojo Grade to Buy, and rising investor participation collectively point to positive momentum. While short-term consolidation may temper gains, the overall trend favours accumulation and potential upside in the coming sessions.
Market participants should remain vigilant to changes in open interest and price action to capitalise on emerging opportunities while managing risk prudently.
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