Amid rising tensions between India and Pakistan, the Indian stock market witnessed a decline on Friday, although a slight recovery from lower levels was observed during the day. However, overall market sentiment remained weak. In contrast, stocks from the defence sector bucked the trend and attracted strong investor interest. Shares of Bharat Electronics Ltd (BEL) surged by up to 4%.
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Other defence companies, including Bharat Forge, Paras Defence, BEL, and Hindustan Aeronautics Ltd (HAL), emerged as top gainers on the BSE. Stocks such as Mazagon Dock Shipbuilders, Cochin Shipyard, BEML, and Data Patterns also witnessed strong buying interest.
Brokerages remain bullish on the sector. Nuwama recently projected a $130 billion defence opportunity over the next five years, driven primarily by capital expenditure plans of the Indian Air Force and Navy. As part of India’s ongoing military modernisation push, fresh orders are anticipated for HAL’s LCA Tejas and Sukhoi upgrade programmes, missile systems like Akash and Astra by BDL, and BEL’s radar and electronic warfare systems.
For FY2026, the Indian defence budget stands at Rs. 6.81 lakh crore, with Rs. 1.8 lakh crore allocated for capital expenditure. Given the escalating border situation, experts believe these allocations may be revised upwards in the near future.
With increased demand and order inflows expected, defence sector companies are likely to see improved profitability in the upcoming quarters, potentially attracting even more investor interest in the coming days.
