India has banned the import of certain defence equipment in order to boost local manufacturing. As a result, analysts expect that defence stocks like Hindustan Aeronautics Ltd., Bharat Electronics Ltd., Larsen & Toubro Ltd. and others will benefit.
The Indian government released its “third positive indigenisation list” of 101 items on Thursday, which comprises highly complex systems, sensors, weapons and ammunition like light-weight tanks, guided extended range rockets for naval utility helicopters, among others.
Here’s a list of defence stocks that have surged recently:
Hindustan Aeronautics Limited
Shares of Hindustan Aeronautics Limited surged to reach a fresh 52-week high of ₹1,693 apiece on Monday’s intraday trade after emerging as the lowest bidder to make five Polar Space Launch Vehicles (PSLVs) for the Indian Space Research Organisation (ISRO).
A few other vendors too will be involved in the work, however, the contract is yet to be finalized.
Research firm CLSA has maintained a buy call on the company’s shares and has upgraded the target from ₹1740 per share to ₹1930 per share.
ICICI Securities expects that HAL can look forward to a potential order of Rs 20,000-25,000 crore by 2025.
Bharat Dynamics Limited
Shares of Bharat Dynamics Limited gained 7.80% today and reached a high of ₹ 776.85 apiece on Monday’s intraday trade on the back of heavy volumes. This came after UAE firm Tawazun Economic Council (TEC) exchanged a Memorandum of Understanding (MoU) to explore new business opportunities in various areas of mutual interest in the field of defence.
As per the MoU, both BDL and TEC will work together and evaluate the viability and feasibility of implementing business opportunities in the field of co-development, co-production, the establishment of joint ventures, set up of maintenance, repair, refurbishment, life extension facilities, supply of military products as well as licensed production.
The company’s shares have gained 32.20% in the last three trading sessions and 122.47% in the last year, giving multibagger returns.
Bharat Electronics Limited
Shares of Bharat Electronics limited gained 1.75% and were trading at ₹ 243.80 apiece. The shares of the company gained about 11.50% in the past week. Experts say that in the short-term time frame, the stock has formed a promising price volume breakout formation.
On April 04, 2022, J M Financial gave a buy call on the share with a target price of ₹270 per share. The time period given by the analyst for the share to be able to achieve the given target is one year.
Research firm CLSA has maintained a buy call on the share and has revised the target from ₹260 to ₹282. BEL is one of the top picks of ICICI Securities and the brokerage has given a buy call on the stock with a target of ₹ 300 apiece.
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