Waaree Energies Ltd Falls 6.53%: 3 Key Factors Driving the Weekly Decline

16 February 2026: Modest Opening Gains Amid Positive Market Sentiment

Waaree Energies began the week on a positive note, closing at Rs.3,115.75, up 0.61% from the previous close. This modest gain came alongside a 0.70% rise in the Sensex to 36,787.89, reflecting broad market optimism. The stock traded with a volume of 54,820 shares, indicating steady investor interest. Despite the positive start, the stock’s performance was largely in line with the market, setting the stage for a volatile week ahead.

18 February 2026: Surge in Open Interest Signals Heightened Derivatives Activity Amid Price Decline

On 18 Feb, Waaree Energies experienced a sharp 23.05% increase in open interest in its derivatives segment, rising from 28,290 to 34,812 contracts. This surge accompanied a significant price drop of 2.94%, with the stock closing at Rs.2,964.10. The underlying stock touched an intraday low of Rs.2,916, down 4.49% from the previous close, indicating strong selling pressure. The weighted average price of traded contracts clustered near the day’s low, suggesting dominance of sellers in the session.

Despite this price weakness, the combined derivatives turnover was robust at ₹59,496.71 lakhs, with futures alone accounting for ₹54,141.47 lakhs and options contracts valued at ₹34,546.86 crores. This activity reflects a complex interplay of bearish sentiment and speculative positioning, as traders recalibrated their bets amid mixed market signals.

Technically, the stock remained above its 20-day and 50-day moving averages but below its 5-day, 100-day, and 200-day averages, indicating short-term weakness amid medium-term support. Investor participation in the cash segment waned, with delivery volume dropping 15.26% compared to the five-day average, signalling a shift towards derivatives trading for hedging or speculation.

18 February 2026: Valuation Metrics Reflect Improved Price Attractiveness

Coinciding with the derivatives activity, Waaree Energies’ valuation profile shifted from very expensive to expensive on 18 Feb. The stock traded at Rs.3,053.85, down 1.99% from the prior close, within a 52-week range of Rs.1,808.65 to Rs.3,864.40. The price-to-earnings ratio moderated to 25.14, contributing to the valuation upgrade, while the price-to-book value remained elevated at 7.65. The enterprise value to EBITDA multiple stood at 15.75, aligning more closely with industry norms.

Compared to peers such as NTPC Green Energy (P/E 135.56) and Suzlon Energy (P/E 19.35), Waaree Energies’ valuation appeared more reasonable, offering a relatively balanced risk-reward profile. Operational metrics supported this view, with a strong return on capital employed of 52.91% and return on equity of 23.53%, well above sector averages. The dividend yield remained low at 0.07%, indicating a focus on growth rather than income.

Despite a negative one-week return of -3.42%, the stock’s improved valuation and upgraded MarketsMOJO Buy rating reflect growing investor confidence in its medium-term prospects.

19 February 2026: Continued Open Interest Growth Amid Price Weakness and Mixed Technicals

On 19 Feb, Waaree Energies saw a further 10.4% increase in open interest to 36,341 contracts, alongside a futures volume of 37,036 contracts. The combined futures and options value was approximately ₹48,408.7 lakhs, underscoring active derivatives market participation. The stock closed at Rs.2,875.70, down 2.98%, with an intraday low of Rs.2,888.1. The weighted average price again clustered near the day’s low, indicating selling pressure or profit-taking at lower levels.

The stock underperformed its sector by 1.52% and the Sensex by 1.12%, marking three consecutive sessions of decline and a cumulative loss of 7.02%. Technical indicators showed the price above the 50-day moving average but below the 5-day, 20-day, 100-day, and 200-day averages, signalling short-term bearishness amid longer-term support.

Investor participation increased notably, with delivery volume surging 106.94% to 4.4 lakh shares on 18 Feb, suggesting heightened commitment possibly reflecting accumulation or distribution ahead of expected price moves. Liquidity remained sufficient for sizeable trades, supporting transactions up to ₹5.34 crore based on average traded value.

20 February 2026: Week Closes with Minor Recovery but Overall Negative Trend

On the final trading day of the week, Waaree Energies edged up 0.66% to close at Rs.2,894.65, recovering slightly from prior losses. The Sensex also gained 0.41% to 36,674.32. Volume was moderate at 55,289 shares. Despite this minor rebound, the stock ended the week down 6.53%, significantly underperforming the Sensex’s 0.39% gain. The week’s price action reflected persistent short-term weakness amid ongoing derivatives market activity and mixed technical signals.

Key Takeaways

Heightened Derivatives Activity: The week saw significant surges in open interest, rising 23.05% on 18 Feb and 10.4% on 19 Feb, indicating active repositioning by traders amid price volatility. This suggests increased speculative and hedging interest, with fresh directional bets being placed despite the stock’s downward trend.

Valuation Improvement: Waaree Energies’ shift from a very expensive to an expensive valuation grade reflects improved price attractiveness, supported by a moderated P/E ratio of 25.14 and strong operational metrics such as a 52.91% ROCE and 23.53% ROE. This valuation adjustment enhances the stock’s appeal relative to peers.

Price Underperformance and Technical Weakness: The stock declined 6.53% over the week, underperforming the Sensex’s 0.39% gain. Technical indicators showed short-term bearishness with prices below key moving averages, although medium-term support remains. Delivery volumes fluctuated, with a notable spike on 18 Feb, indicating mixed investor commitment.

Conclusion

Waaree Energies Ltd’s week was characterised by a notable decline in stock price amid rising derivatives market activity and evolving investor positioning. The sharp increases in open interest alongside falling prices suggest a complex market environment with both bearish sentiment and speculative interest. The valuation upgrade to an expensive grade and a Buy rating reflect underlying operational strength and improved price attractiveness, yet short-term technical weakness and underperformance relative to the Sensex warrant caution.

Investors should closely monitor open interest trends, price action around moving averages, and delivery volumes to gauge the prevailing sentiment and potential directional shifts. While the stock’s fundamentals and market capitalisation support a constructive medium-term outlook, near-term trading is likely to remain volatile amid sectoral and broader market dynamics.

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