Shares of top domestic defence companies surged on October 24, following the Defence Acquisition Council’s (DAC) approval of contracts worth Rs 79,000 crore. Investors reacted positively as the news highlighted significant opportunities for key Indian defence manufacturers.
Market Performance Today
The defence sector saw a notable upswing in the stock market today:
- Bharat Dynamics (BDL): +2.72%
- Cochin Shipyard: +2.34%
- BEML: +1.95%
- Garden Reach Shipbuilders and Engineers (GRSE): +2.01%
- Paras Defence: +0.78%
- Bharat Electronics (BEL): +1.88%
- Mazagon Dock: +2.20%
- Mishra Dhatu: +1.10%
On October 24 at 11 am, the Nifty India Defence index traded 0.6% higher at 8,210 points, extending gains for the seventh consecutive session. Over the last seven trading days, the sectoral index has risen by 3%, reflecting sustained investor confidence in the defence manufacturing space.
Key DAC Approvals and Company Impacts
The DAC’s approval opens up multiple opportunities for domestic defence manufacturers. Some highlights include:
- Bharat Dynamics (BDL): Likely to receive one of the largest allocations, producing Light Weight Torpedos and NAG Missile systems.
- Bharat Electronics (BEL): Focused on Ground Based Mobile ELINT System (GBMES) production.
- BEML: Manufacturing High Mobility Vehicles (HMVs) equipped with Material Handling Cranes.
- Garden Reach Shipbuilders and Engineers (GRSE): Supplying 30mm Naval Surface Guns (NSG).
This decision marks the second major procurement move in 2025, following Operation Sindoor, reinforcing India’s focus on strengthening domestic defence production capabilities.
Company Performance in 2025
The sector has already seen robust performance in 2025:
- Garden Reach Shipbuilders: +63%
- Bharat Dynamics: +39%
- BEML: +9%
- Cochin Shipyard: +18.57%
- Bharat Electronics: +43.89%
These gains underscore investor confidence in companies directly benefiting from government defence contracts and procurement
Regulatory Boost – New Defence Procurement Manual
The Ministry of Defence has also unveiled the new Defence Procurement Manual (DPM), aimed at simplifying regulatory processes. Key provisions include:
- Expedited decision-making: Streamlined processes for faster approvals.
- Relaxed Liquidated Damages (LD):
- Maximum 10% LD for inordinate delays.
- For indigenisation projects, only 0.1% LD per week, reduced from 0.5%.
This regulatory overhaul is expected to further enhance ease of doing business for domestic defence firms, encouraging faster project execution and local manufacturing.
Summary
The DAC’s Rs 79,000-crore approvals have given a strong boost to Indian defence stocks, with Bharat Dynamics, BEML, GRSE, Cochin Shipyard, Paras Defence, BEL, Mazagon Dock, and Mishra Dhatu seeing gains ranging from 0.78% to 2.72%.
With the new Defence Procurement Manual simplifying regulations and promoting indigenisation, the sector is well-positioned for growth. Defence shares have already shown strong performance in 2025, reflecting robust market sentiment and confidence in domestic manufacturing capabilities.
For investors tracking the stock market today, these developments highlight the potential of India’s defence manufacturing sector as a key area to watch.
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