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Defence Stocks to Watch: India’s defence production recorded a historic high of Rs 1.27 lakh crore in FY 2023-24, an impressive 174% increase from Rs 46,429 crore in 2014-15, as per MoD data. The growth is a reflection of the successful implementation of government policies towards self-reliance (Atmanirbharta).
With strategic initiatives, increasing budgets, and key acquisitions, the government is creating a robust setting for defence companies to thrive.
Key DPSUs include Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BEL), Bharat Dynamics Limited (BDL), Mazagon Dock Shipbuilders Limited (MDL), Garden Reach Shipbuilders & Engineers (GRSE), Bharat Forge, Force Motors, Mahindra & Mahindra etc. are set to bag more deals from MoD in coming years which will initially boost investors confidence in these stocks.
These organizations are at the forefront of producing advanced defence equipment, ranging from fighter jets and warships to missiles and electronic systems.
Major Investments and Approvals
The government has actively supported defence companies with large orders and clearances:
Hindustan Aeronautics Limited (HAL)
Hindustan Aeronautics Limited (HAL) received contracts worth Rs 62,700 crore for 156 Light Combat Helicopters (LCH) Prachand helicopters with deliveries starting in two years. The project has over 65% indigenous content and supports 8,500 jobs.
Bharat Forge
Ministry of Defence (MoD) has signed contracts with Bharat Forge Limited and Tata Advanced System Limited for the procurement of 155mm/52 Calibre Advanced Towed Artillery Gun Systems (ATAGS) and High Mobility Vehicle 6×6 Gun Towing Vehicles respectively at a total cost of about Rs 6,900 crore.
Bharat Forge Limited inked the largest domestic contract of 184 indigenously developed Artillery Systems with the Ministry of Defense. This accounts for 60% of the Rs 6900 Cr. procurement by the MOD. The Advanced Towed Artillery Gun System (ATAGS) jointly developed with DRDO is the most advanced 155/52 mm calibre artillery system.
Force Motors & Mahindra & Mahindra
Ministry of Defence has signed a contract with Armoured Vehicle Nigam Limited for the procurement of a Nag Missile System (NAMIS) Tracked version of an anti-tank weapon platform and Force Motors Ltd & Mahindra & Mahindra Ltd for around 5,000 Light Vehicles for the Armed Forces at a total cost of around Rs 2,500 crore.
BEL(Bharat Electronics Limited)
Bharat Electronics Limited (BEL), has secured additional orders worth Rs 1,385 Crore since the last disclosure on 12th March, 2025.
Major orders include radar spares, radar upgradation, electronic voting machines, simulators, advanced land navigation system and stabilizer for tanks, fire control system for ship-based decoys, communication equipment, other spares, services etc.
With these, BEL has now accumulated orders totalling Rs.18,415 Crore in the current financial year.
Record Defence Contracts in 2024-25
In FY 2024-25, the Ministry of Defence signed 193 contracts worth Rs 2,09,050 crore, which was nearly double the previous record. Of these, 92% of the contracts were with domestic companies and amounted to Rs 1,68,922 crore.
In addition, MoD has allocated 75% of the modernisation budget of Rs 1,11,544 crore for indigenous procurement during the ongoing Financial Year.
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