Defence stocks in demand

Shares of nine defence equipments makers rose by 1.2% to 10% after India's Defence Acquisition Council (DAC) on Thursday approved procurement proposals worth around Rs 38,900 crore for various platforms and equipment required by the Armed Forces.

Bharat Dynamics (up 10%), Walchandnagar Industries (up 10%), Hindustan Aeronautics (up 8.85%), Premier Explosives (up 5%), Bharat Electronics (up 4.83%), Bharat Forge (up 3.48%), Dynamatic Technologies (up 1.79%), Astra Microwave Products (up 1.58%) and BEML (up 1.22%) advanced.

Focused on indigenous design and development, these approvals include acquisitions worth Rs 31,130 crore from Indian entities. All the equipment will be manufactured in India, involving the domestic defence industry, with participation from several MSMEs as prime vendors, the Defence Ministry said in a statement.

The indigenous content in some of these projects is up to 80% of the project cost. Defence Minister Rajnath Singh chaired the meeting and approved the proposals.

"A large number of these projects have been made possible due to transfer of technology by the DRDO to the indigenous industry. These include Pinaka ammunitions, BMP armament upgrades and software defined radios for the Army, long range land attack cruise missile (LRLACM) systems and Astra missiles for the Navy and the Air Force. The cost of these design and development proposals is in the range of Rs 20,400 crore," said the statement.

Further, addressing the long felt need of the Air Force to increase its fighter squadrons, the DAC has approved a proposal to procure 21 MIG-29 along with upgradation of the existing 59 Mig-29 aircraft. It has also cleared the procurement of 12 Su-30 MKI aircraft.

"While the MIG-29 procurement and upgradation from Russia is estimated to cost Rs 7,418 crore, the Su-30 MKI will be procured from HAL at an estimated cost of Rs 10,730 crore," the statement said.

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