I bought three lots of Dr Reddy’s 1200-put of August expiry. First lot was bought for ₹15 and two more lots for ₹17.30. What is the outlook for the stock? What can be the target? – Anish Kumar
Dr Reddy’s Laboratories (₹1,220.60): The stock lost about 4 per cent on Friday which resulted in the breach of the support at ₹1,240. The price action since mid-June shows that the scrip has been forming lower highs and lower lows. So, the outlook is clearly bearish.
From the current level, the nearest supports can be spotted at ₹1,200 and ₹1,175. Given the prevailing chart set-up, we expect the stock to decline to these levels in the short term. A fall to ₹1,175 can push the premium of 1200-put from the current ₹26 to approximately ₹40.
As you have three lots, you can consider exiting two lots at ₹32 and the remaining one lot can be liquidated at ₹40.
Also, consider placing a stop-loss at ₹18 now. If the premium goes up to ₹32, exit two lots as mentioned and revise the stop-loss for the remaining position to ₹25.
I’m holding Hindustan Unilever 2600-call option bought at ₹22. It rose to nearly ₹150 and has fallen back to ₹34. Will it rise again? What can be my target? – Prakash M
Hindustan Unilever (₹2,553.70): The stock, over the last two sessions, witnessed a considerable rally. However, on Friday, it reversed lower sharply after the initial gains as it faced a strong barrier at ₹2,725. Consequently, the chart shows that the stock has formed a bearish pin bar, hinting that the price could drop further from the current level.
While ₹2,530 is the nearest support, there is a good chance for the stock to slip below this level. Support levels below ₹2,530 can be spotted at ₹2,500 and ₹2,460. A drop to these levels can drag the option premium lower.
As your trade is in profits despite Friday’s decline and that the stock might see another leg of fall from the current level, we suggest exiting your trade.
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Published on August 2, 2025
