Defence Stocks Rise After Government Clears Acquisitions Worth Rs 84,560 Crore
ideaForge Technology jumped the most by over 6%, followed by Mazagon Dock Shipbuilders, Garden Reach Shipbuilders & Engineers, Bharat Dynamics. and Cochin Shipyard, which were over 2%.
Shares of most defence companies rose on Monday after the Defence Acquisition Council cleared proposals worth Rs 84,560 crore to boost the capabilities of the armed forces and the Indian Coast Guard.
The proposals include air defence tactical control radar, heavyweight torpedoes, medium-range maritime reconnaissance and multi-mission maritime aircraft, flight refueller aircraft and software-defined radios, according to a release by the Ministry of Defence on Friday.
The DAC also accorded an acceptance of necessity under the Buy Indian-Indigenously Designed, Developed and Manufactured category for the procurement of a new generation of anti-tank mines with seismic sensors and the provision of remote deactivation with additional safety features, it said.
IdeaForge Technology Ltd. jumped the most by over 6%, followed by Mazagon Dock Shipbuilders Ltd., Garden Reach Shipbuilders & Engineers Ltd., Bharat Dynamics Ltd. and Cochin Shipyard Ltd., which were up over 2%. This is compared to the NSE Nifty 50, which was trading 0.21% higher.
The announcement comes on the heels of Finance Minister Nirmala Sitharaman presenting the interim Union budget, which had an outlay of Rs 6.21 lakh crore for the defence sector in the next financial year, an increase of 4.7% year-on-year. Out of this, Rs 1.72 lakh crore was allocated for capital acquisition. The budget for the armed forces for revenue expenditure, barring salaries, stood at Rs 92,088 crore.