Defence Stocks To Buy: BEL, BDL, Astra, Among ICICI Securities Bets After DAC Approves Rs 54,000 Crore Deal

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ICICI Securities Report

The Defence Acquisition Council has approved AoNs for eight proposals worth over Rs 540 billion. Three proposals disclosed in public domain relate to:

1. Upgrade of T-90 engine to 1,350 HP from current 1,000 HP;

2. procurement of Varunastra Torpedo, benefiting Bharat Dynamics Ltd.; and

3. procurement of Airborne Early Warning & Control Aircraft Systems, benefitting Bharat Electronics, Astra Microwave and other radar companies in the ecosystem.

Besides, DAC has approved reforms in the capital acquisition process. We see both orders and AoNs picking up again in Q4 FY25 and believe FY26 would be much better if reforms in the capital acquisition process are implemented.

We have Buy rating on BDL (target price:Rs 1,400), BEL (target price: Rs 350) and Astra Microwave (target price: Rs 935).

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