Shares of defence counters rallied ahead of the upcoming Union Budget on Sunday, with MTar Technologies and Data Patterns (India) leading gains. Bharat Dynamics remains the only counter to buck the trend, owing to its weak performance in the December quarter.
The Nifty India Defence index currently leads the sectoal rally, as compared to largely unchanged movement in the benchmark Nifty 50. While the market is not expecting major surprises on headline allocations in the Budget 2026 scheduled to be presented later in the day, attention is firmly on execution momentum, faster order finalisation and clarity on procurement timelines.
Among defence PSUs, companies with strong order books and execution visibility are expected to stay in the spotlight. Hindustan Aeronautics is seen benefiting from its aircraft and engine manufacturing pipeline, while Bharat Electronics remains a key play on defence electronics, radar and communication systems. Bharat Dynamics is also on investors' radar given its role in missile manufacturing, while shipbuilders such as Mazagon Dock Shipbuilders and Garden Reach Shipbuilders are being tracked amid ongoing naval modernisation.
Private sector defence manufacturers are also expected to attract interest as the indigenisation push gathers pace. Larsen & Toubro remains a key beneficiary of large platform and systems integration projects, while Bharat Forge, Data Patterns and Astra Microwave are seen gaining from increased localisation of components, electronics and subsystems.
Market participants expect the defence budget to rise 8-10% year-on-year, broadly in line with recent trends. Analysts note that while higher allocations offer medium-term comfort, stock performance will hinge more on the pace of contract awards, execution progress and timely payments rather than headline numbers alone. Capital expenditure and domestic sourcing are expected to remain priorities.
Defence Stocks Share Price Today
As of 10:00 a.m.,
- Garden Reach: Up 2.09% at Rs 2,822.00.
- Bharat Electronics: Up 2% at Rs 458.
- Mazagon Dock: Up 2.22% at Rs 2,630.
- Hindustan Aeronautics: Up 1.88% at Rs 4,706.10.
- Cochin Shipyard: Up 1.09% at Rs 1,678.
This is in comparison to a marginal 0.02% rise in the benchmark NSE Nifty 50.
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