Answer is NO!, Why?, Because the calculation of Theta takes into account the number of trading days available before the expiry. So weekend and other holidays are accounted for in advance hence no possible decay in theta. Thanks for reading
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It really Depends on Volatility and IV. (IV will change based on India VIX Movement) IV and VIX can also change because of huge gap up/down.
If IV and VIX is decreasing from Friday to Monday opening definitely there will be a decay in the premiums. Min of 10-20 points (CE & PE combined premium) at NIFTY ATM strike and relatively small changes in OTM strikes.
If IV and VIX increased on Monday opening due to some news or any event. Premium decay will be negligible and premiums near ATM strikes can even shoot up after the Monday opening. It happened in the past.
If IV and VIX remain same (almost) and there is no huge gap up/down. There will be Min 5-10 points decay (CE & PE combined premium) in NIFTY ATM strike and relatively less in OTM.
So now question is does Saturday and Sunday will take two days affect of theta decay? The answer is No. Decay happens as if Monday is the next day of Friday.
There won't be significant decay on Monday because of weekend effect.
However on holiday case, one day decay will be factored in. Theta decay effect also take place as if there is no holiday.
In both the cases IV and VIX plays a crucial part as the expiry day will be away from Monday the decay will be less compared to wednesday or Thursday. In holiday case if its on Tuesday or Wednesday there will be good decay happens because of holiday even if its factored in partially, as expiry is nearer.
When long weekend comes there will be an additional theta decay compared to normal weekend. But still IV place a crucial role on that.
*Note: When market opens it takes min 5 min to get the true value of the premiums(real price discovery) in ATM, OTM and near ITM strikes and Far ITM take min 10 min to get a real price discovery. All my analysis won't be considered on the illiquid premium price.
Also theta always reduces. Meaning time will always decay there is only one way move. But premiums decay depends on IV as well. If IV increase is more than theta decay then options premiums will increase even though there is a theta decay. Theta gets an edge near the expiry.
I hope this answer the questions. If you learnt something new please hit the like button.