Saturday, April 13, 2024
Home News Defense stocks rally on bagging contracts from MoD; BEL, BDL surge up...

Defense stocks rally on bagging contracts from MoD; BEL, BDL surge up to 8%


After the Ministry of Defense (MoD) signed contracts with state-owned and private businesses worth more than Rs 35,000 crore, defense stocks on the BSE gained as much as 8% in intraday trading on Friday.

On March 30, 2023, the Ministry of Defense (MoD) entered into contracts with Indian Shipyards, Bharat Dynamics, Bharat Electronics, and BrahMos Aerospace Pvt to acquire various pieces of defense equipment totaling more than Rs 35,000 crore.


Bharat Electronics and Cochin Shipyard’s shares both gained 8%, reaching Rs 98.30 and Rs 496.10. Bharat Dynamics (BDL) gained 5% to Rs 1,010, Garden Reach Shipbuilders & Engineers gained 3% to Rs 1,399, and Data Patterns (India) gained 3% to Rs 1,399 on the BSE. The S&P BSE Sensex, on the other hand, was up 1.1% at 58,610 at 09:34 AM.

With BEL, the MoD has signed 12 separate contracts totaling Rs 8,194 crore. Two of these are for the Indian Air Force (IAF): an Annual Maintenance Contract (AMC) for the Akash missile system and 90 Electronic Warfare (EW) suite equipment for medium lift helicopters.


These are major projects that demonstrate the indigenous design and manufacturing capabilities of the Indian defense industry, which are being led by BEL and involve other MSMEs, the private sector, and the public sector. According to a press release from BEL, these projects will add yet another milestone to the Government of India’s “Atmanirbhar Bharat Abhiyan” and “Make in India” initiatives.

BEL’s total order inflow for FY23 is estimated to be around Rs 20,200 crore with these contracts, which is largely in line with the management’s guidance for the entire year. The execution period is anticipated to last between two and four years, as stated in some contract details. In a note, ICICI Securities stated that strong revenue visibility is provided by the estimated current order backlog of Rs 62,200 crore (3.5x TTM revenue).


Under the takeover (IndianIDDM) category, the Ministry of Defense has signed a contract with Goa Shipyard (GSL) and Garden Reach Shipbuilders and Engineers (GRSE) for 11 next generation offshore patrol vessels (NGOPVs).

GRSE stated in an exchange filing that it has signed a contract with the Ministry of Defense to build four Next Generation Offshore Patrol Vessels. The four GRSE ships are estimated to have a total project cost of Rs 3,500 crore.


The order backlog for this contract is estimated to be around Rs 24,400 crore (9.7 times TTM revenue), and it includes substantial orders for four large survey vessels, eight anti-submarine warfare corvettes, and three P-17A frigates. Strong revenue visibility is provided by a healthy order pipeline and a large backlog, including large contracts worth approximately Rs 22,500 crore for five vessels of the next generation of corvettes.

In the meantime, BDL and the Ministry of Defense agreed to produce and supply the Indian Army with Akash Weapon Systems under a contract worth Rs 8,161 crore. In addition, BDL received a Rs 261 crore order for CMDS for MLH helicopters.


Markets end FY23 in style; Sensex Nifty rally nearly 2% on firm global trends

Market, The final day of the fiscal year 2022-23 saw gains for benchmark indices, with a gain of nearly 2% on Friday, extending gains for...

Day trading guide for today: 6 stocks to buy or sell on Friday — 31st March

Trading, Day trading guide for today: Indian shares gained on Wednesday as global markets' increased risk appetite was aided by easing in the banking industry....

Financial, IT stocks aid Indian shares snap three-month losing streak

Financial, By Bharat Rajeshwaran BENGALURU (Reuters) - Indian shares rose on Friday, supported by a higher weighting of financial stocks and information technology (IT) stocks,...


Please enter your comment!
Please enter your name here


Most Popular

Trading the Inside Bar Pattern on Pocket Option Platform

Inside Bar Pattern Introduction Price movement on a chart is examined in price action trading. You may use candlesticks to predict where prices will move...

“Unlocking the Secrets: 4 Tricks of Successful Traders on Pocket Option Platform”

For a year, I have been trading on the Pocket Option platform. I sometimes succeed and sometimes fail. However, I was confident that if...

Identifying Mistakes That Lead to Losses on Pocket Option

Why do people lose their money when trading binary options New traders frequently take a significant financial risk while trading binary options. As a result,...

Weekly Income Plan on Pocket Option Platform”

Get weekly returns on Pocket Option It turned out that October was a terrific month for me. I am still able to generate money every...

Recent Comments