India’s defence stocks are witnessing some profit booking from higher levels after US President Donald Trump announced a ceasefire between Israel and Iran in the early hours of Tuesday, June 24, although both the countries are yet to officially confirm the same.Shares of Mishra Dhatu Nigam fell as much as 5% and were the top losers on the BSE Smallcap index. Other losers included Garden Reach Shipbuilders (down 4%), Astra Microwave (down 4%), Paras Defence and BEML (down 3% each), Bharat Dynamics (down 2.5%) and Hindustan Aeronautics and Mazagon Dock Shipbuilders (down 1.5% each).
Before today’s drop, shares of Midhani had risen 15% in the last one month, while those of Garden Reach Shipbuilders had surged close to 25% during the same period, making new highs in the process.
Cochin Shipyard, whose shares had also surged nearly 20% in the last one month, are down 2% in today’s trading session. Astra Microwave, whose shares had surged 10% on Monday, are giving up some of those gains today.Brokerage firm Nirmal Bang in its note had mentioned that defence stocks have surged in the recent past due to heightened emphasis on indigenisation and Atmanirbhar Bharat initiatives.An expansion in the indigenisation list and potential for defence exports also adds to the bullish stance for Nirmal Bang on the future of defence stocks.”We maintain a positive outlook on the defence sector, highlighting the ongoing efforts towards indigenization, a strong order pipeline, and significant growth potential,” the brokerage said, adding that Solar Industries is their top pick in the sector.Hindustan Aeronautics, Bharat Dynamics, BEML and Data Patterns are also some of Nirmal Bang’s other preferences.
