From Mazagon Dock To BHEL: Defence Stocks Likely To Benefit From Govt's Rs 79,000-Crore Arms Push
Some of the potential beneficiaries include Cochin Shipyard, Larsen & Toubro, and Garden Reach Shipbuilders & Engineers Ltd.
Mazagon Dock Shipbuilders Ltd., Bharat Dynamics Ltd., Bharat Heavy Electricals Ltd., Data Patterns, Astra Microwave Products Ltd., BEML Ltd and Cochin Shipyard Ltd. will be in focus after the Defence Acquisition Council (DAC) on Thursday approved arms acquisition proposals worth approximately Rs 79,000 crore, according to Elara Securities.
The approvals come as part of the government’s continued emphasis on “Aatmanirbharta” in defence, with the majority of contracts expected to be awarded to domestic firms across land, naval, and air platforms.
According to the brokerage, Bharat Dynamics is among the key beneficiaries as the government approved Nag Missile System (Tracked) Mk-II (NAMIS) — a next-generation anti-tank guided missile platform expected to significantly improve armoured warfare capability.
With an estimated project size of around Rs 2,000 crore, Bharat Dynamics will be in focus due to its role as the principal manufacturer of guided missile systems for the armed forces.
The armed forces will also procure the Ground-Based Mobile ELINT System (GBMES), aimed at enhancing electronic warfare and intelligence capabilities. Bharat Electronics and Astra Microwave are expected to gain from this project, given their expertise in radar and electronic intelligence systems, as per Elara.
Additionally, the acquisition of High Mobility Vehicles (HMVs) equipped with material handling cranes has been cleared, improving logistical flexibility and mobility in varied terrains. BEML and other domestic vehicle manufacturers are likely to benefit from this segment, the brokerage said.
The Indian Navy has received the largest allocation in this round of clearances, with projects worth an estimated Rs 60,000 crore. The centrepiece of this is the long-pending Landing Platform Dock (LPD) programme — a critical asset for amphibious warfare and disaster relief operations.
The key beneficiaries here could include Mazagon Dock Shipbuilders, Cochin Shipyard, Larsen & Toubro Ltd., and Garden Reach Shipbuilders & Engineers Ltd.
The DAC has also cleared the 30mm Naval Surface Gun (NSG) and Smart Ammunition for the 76mm Super Rapid Gun Mount, where BHEL and Garden Reach Shipbuilders could see potential upside.
Further, the Navy’s undersea warfare capabilities will receive a boost through the procurement of Advanced Light Weight Torpedoes (ALWT), estimated at Rs 500–1,000 crore, with Bharat Dynamics again emerging as a key supplier.
To strengthen situational awareness and target tracking, the DAC approved the Electro-Optical Infra-Red Search and Track System (EO-IRST), a high-end naval sensor suite expected to benefit BEL, Astra Microwave, and Data Patterns.
For the Indian Air Force, the DAC has cleared proposals for the Collaborative Long Range Target Saturation/Destruction System (CLRTS/DS) and other advanced weapon system projects aimed at improving precision strike capabilities. While specific project values were not disclosed, Elara analysts expect meaningful participation from electronics and missile system players.
