Vodafone Idea Ltd Sees Surge in Call Option Activity Amid Bullish Sentiment

Robust Call Option Volumes Highlight Investor Interest

Data from the derivatives market reveals that Vodafone Idea’s call options expiring on 27 January 2026 have attracted substantial trading volumes. The most active strike price is ₹12, with 7,935 contracts traded, generating a turnover of approximately ₹3913.36 lakhs. This is followed by the ₹13 strike, which saw 6,072 contracts traded and a turnover of ₹1475.59 lakhs, and the ₹14 strike with 4,931 contracts and ₹528.66 lakhs turnover. Open interest figures further underscore this activity, with 10,769 contracts outstanding at the ₹12 strike, 7,418 at ₹13, and 6,260 at ₹14.

This concentration of call option activity above the current underlying price suggests that market participants are positioning for an upward move in Vodafone Idea’s shares over the coming weeks. The clustering of open interest at these strikes also indicates potential resistance levels that traders will be watching closely as expiry approaches.

Underlying Stock Performance Supports Bullish Outlook

Vodafone Idea’s stock has outperformed its sector peers recently, delivering a 3.22% gain on the latest trading day compared to the Telecom - Services sector’s 0.59% rise and the Sensex’s marginal decline of 0.19%. The stock has recorded consecutive gains over the past two sessions, accumulating a 3.58% return in this period. Notably, Vodafone Idea is trading above its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, signalling a positive technical momentum despite its current Mojo Grade of Sell (46.0), which was upgraded from Strong Sell on 17 October 2025.

However, investor participation appears to be waning, with delivery volume on 8 January falling by 42.8% to 14.12 crore shares compared to the five-day average. This decline in delivery volume may reflect cautious sentiment or profit-taking amid the recent rally. Liquidity remains adequate, with the stock’s traded value supporting trade sizes up to ₹22.56 crore based on 2% of the five-day average traded value.

Market Cap and Sector Context

Vodafone Idea is classified as a mid-cap stock with a market capitalisation of approximately ₹1,24,594 crore. Operating within the Telecom - Services sector, the company faces intense competition and regulatory challenges, which have historically weighed on its valuation and investor sentiment. The current Mojo Grade of Sell reflects ongoing concerns about profitability and balance sheet strength, despite recent operational improvements.

Nonetheless, the surge in call option activity suggests that some investors are betting on a turnaround or a positive catalyst in the near term. The telecom sector has been undergoing consolidation and tariff stabilisation, which could improve margins and cash flows for Vodafone Idea if these trends continue.

Expiry Patterns and Strike Price Analysis

The expiry date of 27 January 2026 is critical as it marks the next major derivatives settlement for Vodafone Idea. The heavy open interest at the ₹12, ₹13, and ₹14 strikes indicates that traders are focusing on these levels as key price points. The underlying price of ₹11.88 is just below the lowest of these strikes, implying that a move above ₹12 would be necessary for these call options to gain intrinsic value.

Given the high turnover and open interest at the ₹12 strike, this level may act as a psychological barrier or a target for bulls. If the stock manages to breach this strike price convincingly, it could trigger further call buying and short covering, potentially accelerating the rally. Conversely, failure to surpass these strikes could lead to profit-taking and a reversion to lower levels.

Investor Sentiment and Strategic Implications

The increased call option volumes reflect a cautiously optimistic investor stance. While the stock’s fundamental outlook remains challenged, the technical signals and derivatives positioning suggest that market participants are preparing for a possible recovery. This is consistent with Vodafone Idea’s recent outperformance relative to its sector and the broader market.

Investors should weigh the risks of the company’s financial health against the potential for short-term gains driven by market sentiment and sector dynamics. The stock’s liquidity and trading volumes support active participation, but the falling delivery volumes caution against complacency.

Conclusion: Navigating Vodafone Idea’s Derivatives Landscape

Vodafone Idea Ltd.’s recent surge in call option trading ahead of the 27 January expiry highlights a growing bullish sentiment among derivatives traders. The concentration of open interest at strikes above the current market price signals expectations of a potential upside, supported by the stock’s recent technical strength and sector outperformance.

However, the company’s fundamental challenges and the sell-grade Mojo Score advise caution. Investors should monitor price action around the ₹12 to ₹14 strike range closely, as these levels will likely dictate near-term momentum. The derivatives market activity offers valuable insights into market expectations, but a balanced approach considering both technical and fundamental factors remains essential for informed decision-making.

As Vodafone Idea navigates a complex operating environment, the interplay between option market positioning and underlying stock performance will be critical to watch in the weeks ahead.

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