L&T, Siemens Energy Among Motilal Oswal's Pick In Capital Goods; BEL Tops Defence In Q3 Results Preview

Motilal Oswal expects execution growth to remain healthy for its coverage companies in the capital goods universe, driven by strong order inflows and order books for them. While ordering remains strong across thermal power, renewables, T&D, data centers, buildings and factories, and defense, the brokerage is selective in picking up from the domestic private sector.

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Motilal Oswal Report

Motilal Oswal maintains a positive stance on select names in Capital Goods and defence space, favoring Larsen and Toubro Ltd., Cummins India Ltd. and Siemens Energy Ltd. in the large-cap space, and Kirloskar Oil Engines Ltd. and Kalpataru Projects International Ltd. in mid- and small-cap segments. In defense, Bharat Electronics remains the top pick.

With a strong order backlog, improving execution, and government push on infrastructure and defense, the capital goods sector is well-positioned for sustained growth. Investors are advised to monitor commodity price trends and private sector ordering, which is gradually picking up in metals, mining, and thermal power.

Recently the Defense Acquisition Council approved capital acquisition proposals worth Rs 79,000 crore billion in its winter session, taking FY26 year-to-date approvals to Rs 33,00,000 crore, nearly double last year's capital outlay. This provides strong visibility for order conversions over the next two–four years.

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