Author plans to buy February ITC puts expecting the stock to fall after the budget if cigarette taxes are increased.
Unpriced research observations (excluded from Calls and Returns):
ITC.NS — SHORT The author plans to buy February ITC put options because he expects the government to increase cigarette taxes in the budget, which would drive ITC's stock price down and raise put premiums. The trade is a directional bet on ITC shares declining, not a premium-income strategy. He notes the stock has already fallen 10%, is a solid scrip that does not usually drop much, and fears theta erosion if he enters too early. ambiguous_option_contract
I'm planning to buy the put option of ITC for the month of Feb now so that after budget when the government announce the increase in taxes for cigarettes, I believe the stock price would come down eventually increasing the option premiums of put.