Covered positions in stock f&O are cash settled?

Zerodha
1

As the physical delivery of underlying asset is compulsory in F&O. i need to know whether if options can be exercised without the need of physical delivery in netoff positions for example:-

example:

Spot price at time of entering position: 5700

Buy Maruti Fut
Buy ATM Put option

Spot @ expiry: 5600

2

Here is the list of scenarios in which positions are netted off against each other
image

You can read more here.

3

@siva What about margin requirements, i guess margin requirements will increase(10, 25, 45, 70%) for uncovered positions as expiry date approaches and not for net off positions.

4

For index there won’t be any increase but for stocks margins will be double of actual on last wednesday and thursday of expiry week.