Vedanta Ltd Sees Sharp Open Interest Surge Amid Strong Market Momentum

Open Interest and Volume Dynamics

On 25 Feb 2026, Vedanta Ltd. (symbol: VEDL) recorded an open interest of 92,784 contracts in its derivatives, marking a substantial increase of 13,333 contracts or 16.78% compared to the previous OI of 79,451. This sharp rise in OI coincided with a daily volume of 1,34,109 contracts, reflecting strong participation from traders and investors alike. The futures segment alone accounted for a notional value of approximately ₹1,47,305.69 lakhs, while options contributed an overwhelming ₹99,351.51 crores, culminating in a total derivatives value of ₹1,76,026.48 lakhs.

The underlying stock price closed at ₹724, having touched an intraday high of ₹732.35, up 5.36% on the day. This price appreciation was accompanied by a 4.25% day change and a two-day consecutive gain totalling 6.28%, underscoring sustained bullish momentum. Notably, Vedanta outperformed its sector, which gained 3.01%, and the broader Sensex, which rose a modest 0.22% on the same day.

Market Positioning and Directional Bets

The surge in open interest alongside rising volumes typically indicates fresh capital inflows and increased conviction among market participants. In Vedanta’s case, the 16.78% jump in OI suggests that traders are establishing new positions rather than merely squaring off existing ones. Given the concurrent price rally and the stock trading above all key moving averages (5-day, 20-day, 50-day, 100-day, and 200-day), the market sentiment appears decidedly bullish.

Further supporting this view is the rising investor participation in the cash segment, with delivery volumes reaching 54.97 lakh shares on 24 Feb, a 25% increase over the five-day average. This uptick in delivery volume indicates genuine buying interest rather than speculative trading, which often manifests as high volumes but low delivery percentages.

Such a combination of rising OI, volume, and price typically points to directional bets favouring an upward trajectory. Traders may be positioning for further upside, anticipating positive catalysts such as improved commodity prices, operational efficiencies, or favourable policy developments impacting the non-ferrous metals sector.

Technical and Fundamental Context

Vedanta’s current trading price of ₹724 is comfortably above its key moving averages, signalling a strong technical uptrend. The stock’s 5-day return of 3.96% outpaces the sector’s 3.16%, reinforcing its relative strength. The company’s market capitalisation stands at a robust ₹2,82,584.19 crores, categorising it as a large-cap stock with ample liquidity. Based on 2% of the five-day average traded value, the stock can accommodate trade sizes up to ₹12.76 crores without significant market impact, making it attractive for institutional investors.

From a fundamental perspective, Vedanta offers a dividend yield of 3.31%, which is appealing in the current market environment where income generation remains a priority for many investors. The company’s Mojo Score of 68.0, recently downgraded from a Buy to a Hold on 23 Feb 2026, reflects a cautious stance amid evolving market conditions. This rating suggests that while the stock remains fundamentally sound, investors should monitor developments closely before committing additional capital.

Sectoral and Macro Considerations

The non-ferrous metals sector has gained 3.01% recently, buoyed by improving global demand and supply constraints that have supported commodity prices. Vedanta, as a key player in this space, stands to benefit from these tailwinds. However, investors should remain mindful of potential headwinds such as regulatory changes, currency fluctuations, and geopolitical risks that could impact raw material costs and export competitiveness.

Given the sector’s cyclical nature, the recent surge in derivatives activity may also reflect hedging strategies by producers and consumers seeking to manage price volatility. This dynamic adds complexity to interpreting open interest movements, as not all increases necessarily indicate directional bets but may also represent risk mitigation.

Investor Takeaways and Outlook

For investors and traders, the recent surge in Vedanta’s open interest combined with strong volume and price appreciation signals a positive near-term outlook. The stock’s ability to sustain gains above key moving averages and outperform its sector peers suggests underlying strength. However, the downgrade in Mojo Grade from Buy to Hold advises a measured approach, highlighting the importance of monitoring market developments and company-specific news.

Market participants should also consider the broader commodity cycle and macroeconomic factors influencing the non-ferrous metals industry. While the current momentum is encouraging, volatility remains a risk, and prudent risk management is essential.

In summary, Vedanta Ltd. is attracting renewed interest in the derivatives market, reflecting increased bullish positioning and investor confidence. The stock’s technical and fundamental attributes support this positive sentiment, though cautious optimism is warranted given the sector’s inherent cyclicality and external risks.

Limited Period Only. Start at Rs. 9,999 - Get MojoOne for 1 Year + 3 Months FREE (60% Off) Get 71% Off →