I have identified a good stock but the options re illiquid. Should I buy the stock in cash market or should I purchase a call option?

As an options trader, you can either trade in options or you can also buy the stock. It is always better to avoid stocks that have illiquid option volumes. That puts a huge basis risk and if you are stuck in a position without any buyer then it really means you miss out your premium and also the opportunity. This is quite a common problem in mid cap and small cap options. Before you buy an option, be clear that the volumes are strong. You rarely find this problem in Nifty options or in options of highly liquid stocks. However, there are plenty of options on mid-cap shares which can suddenly get illiquid. Sometimes the illiquidity can take the spread to several rupees and that can lead to losses. Illiquid options are best avoided.