Defence stocks found fresh buying interest in the stock market today, tracking a key development from the Ministry of Defence (MoD). On December 31, shares of BEML, Bharat Electronics, Bharat Dynamics, Bharat Forge, and Hindustan Aeronautics traded higher, rising in the 1–2% range, as sentiment improved across the defence space.
The trigger was clear. The MoD signed defence procurement contracts worth Rs 4,666 crore, covering close-quarter battle carbines and heavyweight torpedoes. The news acted as a sentiment booster for the entire defence ecosystem, pushing the sector out of a short losing spell.
Market Performance: Defence Index Breaks Losing Streak
The move was visible at the index level as well.
- Nifty India Defence Index traded 1.3% higher
- Index level stood at 7,745.6 around 10:20 am
- The gain ended a three-session losing streak
Stocks such as BEML, Bharat Electronics, Bharat Dynamics, Bharat Forge, and Hindustan Aeronautics moved up in tandem, reflecting broad-based participation rather than stock-specific action.
This rise in defence stocks aligned directly with the contract announcements, keeping the market narrative clean and data-driven.
Main News: Rs 4,666-Crore Defence Contracts Signed
The Ministry of Defence confirmed that contracts totaling Rs 4,666 crore were signed for two major procurements:
- Over 4.25 lakh close-quarter battle carbines
- 48 heavyweight torpedoes
These procurements are aimed at strengthening operational readiness across the Indian Army, Indian Navy, and submarine fleet.
The MoD described the move as part of its push to modernise equipment and replace older systems with newer platforms.
Bharat Forge in Focus: Largest Small Arms Deal
Bharat Forge drew particular attention during the session.
The company signed its largest-ever small arms contract, valued at Rs 1,667 crore, with the Ministry of Defence. The order is for the supply of indigenously designed and developed close-quarter battle carbines.
This contract forms a significant portion of the overall carbine procurement programme and was a key factor behind the positive move in Bharat Forge share price during the day.
Break-up of Carbine Contracts
According to the MoD statement:
- Battle carbine contracts (with accessories): Rs 2,770 crore
- Signed with:
- Bharat Forge Ltd
- PLR Systems Pvt Ltd
- Supplies are intended for:
- Indian Army
- Indian Navy
The ministry highlighted that these contracts are part of the broader effort to replace legacy systems with newer, domestically developed solutions.
Torpedo Procurement: Strengthening Submarine Capability
The remaining portion of the total contract value relates to underwater warfare systems.
- 48 heavyweight torpedoes
- Approximate cost: Rs 1,896 crore
- Contract signed with WASS Submarine Systems SRL, Italy
- Intended for Kalvari-class submarines of the Indian Navy
The MoD stated that this acquisition will enhance the combat capability of the six Kalvari-class submarines currently in service.
Delivery Timeline for Torpedoes
The torpedo supply follows a defined schedule:
- Deliveries begin: April 2028
- Completion: Early 2030
The ministry noted that these torpedoes come with advanced technological features and significant operational capabilities, designed to strengthen submarine warfare readiness.
Company-Level Impact Across Defence Stocks
While Bharat Forge remained in focus, other major defence names also moved higher on the back of improved sector sentiment:
- BEML share price gained as overall defence procurement activity picked up
- Bharat Electronics share price tracked the sector-wide rise
- Bharat Dynamics share price moved higher alongside peer stocks
- Hindustan Aeronautics share price also traded in positive territory
The price action reflected optimism linked to government procurement activity rather than company-specific announcements outside the stated contracts.
Summary: What Drove Defence Stocks Today?
To sum up the session for defence stocks:
- Defence stocks rose 1–2% on December 31
- Triggered by Rs 4,666-crore MoD defence contracts
- Orders include:
- 4.25 lakh+ battle carbines
- 48 heavyweight torpedoes
- Nifty India Defence Index rose 1.3%, ending a three-day decline
- Bharat Forge signed a Rs 1,667-crore small arms contract
- Torpedo deliveries scheduled between 2028 and early 2030
In the stock market today, defence counters reacted purely to confirmed developments, with sentiment improving across names like BEML, Bharat Electronics, Bharat Dynamics, Bharat Forge, and Hindustan Aeronautics, keeping the narrative grounded in numbers and official announcements.
Source: Moneycontrol
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