Bharat Dynamics & 3 other defence stocks jumps up to 7% after surge in global military spending

India’s defence sector is undergoing significant transformation, with a budget allocation of ₹6.81 trillion for 2025-26, marking a 9.5% increase. Defence exports reached ₹21,083 crore in FY 2023-24, and the sector aims for $5 billion in exports by 2025. Modernization efforts focus on indigenous production and cutting-edge technologies like AI and drones.

Defense stocks surged as European counterparts like Saab AB, Rheinmetall AG, BAE Systems, and Leonardo gained 15-20% overnight. A Goldman Sachs European defense stock basket hit a record high, adding $35 billion in market capitalization, despite a broader global equity selloff, driving positive momentum in Indian defense stocks.

European defense stocks surged after regional leaders pledged to increase military spending. French President Emmanuel Macron, following a London meeting, proposed a €200 billion ($210 billion) EU investment to strengthen defense capabilities, signaling a significant boost to the sector amid rising geopolitical concerns.

Expectations of increased defense spending in Europe have driven a sharp rally in sector stocks. Rheinmetall, a key supplier for land forces, has surged over 90% this year and risen more than eleven-fold since Russia’s invasion of Ukraine began three years ago, reflecting strong industry growth.

As of FY24, Indian Defence export surged to Rs 21,000 crore, which was a growth of 32.5 percent over the past year. India currently exports defence equipment to over 100 countries, with the top three destinations being the US, France, and Armenia, according to PIB.

The Union Budget allocated ₹6.21 lakh crore to the defense sector this year. India aims for ₹1.75 lakh crore in defense production in 2024, targeting ₹3 lakh crore by 2029. Defense exports are set to rise, with a goal of ₹50,000 crore by 2029.

Here are the defense stocks skyrocketed as European peers rallied, while global equities faced heavy selling pressure:

1. Bharat Dynamics Ltd 

With a market capitalization of Rs 37,737.61 crore, the shares were trading at Rs 1,029.50 per share, increased around 7 percent as compared to the previous closing price. As of September 30, 2024, Bharat Dynamics had an export order position of approximately ₹2445 crore.

2. Garden Reach Shipbuilders & Engineers Ltd

With a market capitalization of Rs 14,466.77 crore, the shares were trading at Rs 1,262.90 per share, increased around 4.11 percent as compared to the previous closing price.

As of February 2025, exports account for approximately 4% of GRSE’s total order book of ₹23,877 crore, contributing around ₹970 crore. The company’s primary revenue remains domestically driven, with a limited but growing share from international orders.

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3. Cochin Shipyard Ltd

With a market capitalization of Rs 32,947 crore, the shares were trading at Rs 1,252 per share, increased around 7 percent as compared to the previous closing price. 

Recent data indicates that Cochin Shipyard Ltd. has exported approximately 45 ships to various clients outside India. This showcases the company’s robust capabilities in shipbuilding and repair, as it has established itself as a significant player in the global maritime industry.

4. Bharat Electronics Ltd

With a market capitalization of Rs 1.93 lakh crore, the shares were trading at Rs 264.50 per share, increased around 3 percent as compared to the previous closing price. 

Bharat Electronics Ltd. (BEL) recorded export sales of USD 92.98 million in FY 2023-24, a 92% surge from USD 48.33 million in the previous year, highlighting its growing global footprint and strengthening position in the defense and electronics export market.

Written by Abhishek Singh

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