Defence Sector Check - Getting Future Ready: ICICI Securities

ICICI Securities Report

The pace of ordering, encompassing all the three services continued in September 2023 as well (from August 2023). Key points:

1. Acceptance of Necessity worth Rs 450 billion was approved for various platforms by Defence Acquisition Council.

2. The Indian Air Force along with the Indian Army moved a proposal to the defence ministry to procure 156 light combat helicopter-Prachand.

3. Project to upgrade Su-30 aircraft receives the necessary clearance and budgetary sanctions from the Ministry of Defence and the Indian Air Force.

4. request for proposal for Next Gen Destroyer programme is likely by CY26.

Bharat Electronics Ltd. received Rs 30 billion worth of orders, taking the total order inflow for FY24 to Rs 143.8 billion thus far.

We remain positive on defence space with

• BEL ('Buy'; target price: Rs 150),

• Bharat Dynamics Ltd. ('Buy'; target price: Rs 1,325) and

• Hindustan Aeronautics Ltd. ('Add'; target price: Rs 4,350) - as our key picks.

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