Defence stocks rally on push for Atmanirbhar

Mumbai: Stocks of companies supplying to the Indian military rallied up to 13% in Monday’s market after the defence minister on Sunday announced a big push for manufacture of hardware for the sector by domestic companies. Under its Atmanirbhar (self-reliance) initiative, the government has prepared a list of 101 items on which it will put import embargo over the next few years so that they are produced locally, it said.

Following the decision, shares of Bharat Electronics, a government-run company, rallied over 13% in early trade and closed 9% higher, while BEML, another PSU catering to the military, rallied over 5% and closed 4% higher. Hindustan Aeronautics, also a PSU and serving the Indian Air Force in a major way, rallied over 10% and closed 9% higher. Other top gainers from this lot were Astra Microwave, up 6%.

According to a report by Edelweiss, its analysts were positively surprised with the pace of policy announcement, which were far more specific and included clear timelines. “One could expect further announcements in days to come for a much greater clarity beyond what is already available. The list seems fairly exhaustive, but may expand in future and is based on comprehensive inputs from private/public sector stakeholders, which is a key highlight in our view,” the broking house said.