Synopsis: India’s long-awaited Rs. 70,000 crore Project-75(I) submarine programme has moved closer to execution, marking one of the country’s largest-ever naval defence initiatives. The project, which involves the indigenous construction of six next-generation stealth submarines, is expected to create long-term opportunities for companies engaged in submarine construction, critical engineering systems and advanced naval electronics. Here are three listed defence companies poised to benefit from India’s underwater warfare modernisation.
India is strengthening its underwater combat capabilities as geopolitical tensions in the Indo-Pacific continue to rise. The government’s submarine modernisation roadmap includes the acquisition of six advanced diesel-electric submarines equipped with Air Independent Propulsion (AIP) technology under Project-75(I), along with upgrades to the existing submarine fleet and future indigenous nuclear submarine programmes.
The proposed Project-75(I), valued at around Rs. 70,000 crore, is expected to be one of India’s biggest defence contracts and forms a key pillar of the country’s long-term naval modernisation strategy. Once approved, the programme will significantly enhance indigenous manufacturing under the “Make in India” initiative while creating multi-year revenue opportunities for domestic defence companies.
1. Mazagon Dock Shipbuilders Ltd
Mazagon Dock Shipbuilders is India’s only shipyard with proven expertise in building conventional submarines, having successfully delivered all six Kalvari-class (Scorpène) submarines under Project-75.
With the market capitalization of Rs. 99,372.66 Crores, the shares of Mazagon Dock Shipbuilders Ltd were closed at around Rs. 2473 per share which is 26.6 percent discount from its 52 week high of Rs. 3369 per share and is trading at a P/E of 38.9 whereas industry P/E stands at 48.9.
The company is expected to be the biggest beneficiary of Project-75(I), where it has partnered with Germany’s ThyssenKrupp Marine Systems (TKMS) to manufacture six next-generation stealth submarines in India. If the contract is signed, the project alone could substantially expand Mazagon Dock’s order book and provide execution visibility extending well into the next decade.
Mazagon Dock has already demonstrated strong execution capabilities in complex naval platforms, including destroyers, frigates and submarines. The company reported a 34 percent year-on-year growth in net profit to Rs. 674 crore in Q4 FY26, supported by higher execution across shipbuilding and submarine programmes.
The submarine programme also strengthens Mazagon Dock’s technological capabilities through advanced technology transfer, higher indigenous content and expertise in Air Independent Propulsion systems, reinforcing its leadership in India’s naval shipbuilding sector.
2. Larsen & Toubro Ltd
Larsen & Toubro has emerged as India’s leading private-sector defence engineering company with deep capabilities across naval platforms, strategic systems and heavy engineering.
With the market capitalization of Rs. 5,78,095.16 Crores, the shares of Larsen & Toubro Ltd were trading at around Rs. 4205 per share which is 5.29 percent discount from its 52 week high of Rs. 4440 per share and is trading at a P/E of 35.2 whereas industry P/E stands at 17.8.
Although Mazagon Dock is expected to lead submarine construction under Project-75(I), L&T remains a critical contributor to India’s submarine ecosystem by manufacturing pressure hulls, launch systems, propulsion equipment, precision-engineered assemblies and other strategic components used in both conventional and nuclear submarines.
The company has also played an important role in India’s indigenous nuclear submarine programme by supplying mission-critical engineering systems, demonstrating capabilities that only a handful of companies globally possess.
India’s continued focus on indigenous defence manufacturing and future submarine programmes such as Project-76 and nuclear attack submarines could generate sustained opportunities for L&T’s defence business over the coming decade. The company’s diversified engineering capabilities also reduce dependence on any single defence programme while positioning it to benefit from rising naval capital expenditure.
3. Bharat Electronics Ltd
Bharat Electronics Ltd (BEL) is India’s largest defence electronics manufacturer and plays a crucial role in supplying advanced electronic systems for naval platforms. With the market capitalization of Rs. 2,97,362 Crores, the shares of Bharat Electronics Ltd were trading at around Rs. 407 per share which is 14.1 percent discount from its 52 week high of Rs. 473.45 per share and is trading at a P/E of 49 whereas industry P/E stands at 61.5.
Modern submarines rely heavily on sophisticated electronics rather than just mechanical engineering. BEL manufactures and integrates sonar systems, communication equipment, combat management systems, electronic warfare solutions, radar technologies and underwater sensors that enable submarines to detect threats, communicate securely and execute combat missions.
As India inducts more advanced submarines into its fleet, demand for indigenous electronic warfare and underwater surveillance systems is expected to increase significantly. BEL’s long-standing relationship with the Indian Navy and its strong focus on defence indigenisation position it to benefit from higher procurement of mission-critical naval electronics.
The company continues to maintain one of the strongest defence order books in the country while expanding into next-generation technologies, including artificial intelligence, unmanned systems, cybersecurity and advanced defence electronics, providing long-term growth visibility beyond conventional defence equipment.
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