India’s defence sector is on the verge of a strong multi-year growth cycle as it is being propelled by rising geopolitical tensions, growing defence spending and the government’s drive for self-reliance in defence manufacturing. In this context, brokerage firm Antique Stock Broking has maintained a positive outlook on a few Indian defence stocks: HAL, Bharat Electronics (BEL), Bharat Dynamics (BDL), Mazagon Dock Shipbuilders, Zen Technologies, Solar Industries India and PTC Industries.
The brokerage believes that the ordering pipeline for FY26-27 is still robust and there are a lot of growth opportunities for companies that are manufacturing missiles, aircraft, ammunition, anti-drone systems, rockets, naval platforms and high-energy materials, for example.
In FY26 the Ministry of Defence has accepted Acceptance of Necessity (AoNs) worth about Rs 6.7 lakh crore in this regard, which highlights the scale of the upcoming procurement cycle. And domestic defence manufacturers will remain a key beneficiary as India is focused on increasing indigenous production and less reliance on imports.
HAL | Buy | Target Price: Rs 6,026
Hindustan Aeronautics Ltd (HAL) remains one of the key beneficiaries of India’s defence aerospace spending because it has a dominant position in the domestic aircraft manufacturing ecosystem.
Antique Stock Broking expects HAL’s supply-chain challenges to ease as engine deliveries from GE improve. GE has delivered 7 engines to HAL so far and is expected to deliver another 15-20 engines in FY27 for the Tejas Mk-IA programme.
The brokerage expects final operational clearance for the aircraft by September 2026. A subsequent ramp-up in LCA deliveries along with HAL’s revenue growth during FY27-28 will help to drive HAL’s revenue growth.
Antique maintained its Buy rating and raised its target price on HAL to Rs 6,026, valuing the company at 40 times its estimated H1FY28 earnings per share.
Bharat Electronics | Buy | Target Price: Rs 532
Bharat Electronics (BEL) continues to benefit from strong defence electronics demand, increasing indigenous content and a healthy execution pipeline.
Antique Stock Broking believes that the company is well positioned for sustained growth, supported by healthy order inflows, investments in research and development and India’s increasing focus on indigenisation.
BEL’s export business expansion and investment in new defence technologies and the development of next-generation defence technology would also contribute to BEL’s long-term growth.
Hence, the brokerage maintained its Buy rating on BEL and maintained its target price at Rs 532 per share, which is 45 times its expected H1FY29 EPS.
Bharat Dynamics | Buy | Target Price: Rs 1,597
Bharat Dynamics (BDL) is also an important beneficiary of India’s defence modernisation and self-reliance initiative. The company’s large order book and export potential help it be able to see a future growth opportunity.
Antique Stock Broking remains optimistic regarding the long-term prospects of BDL as missile and other defence systems demand increases.
The brokerage said it is a Buy recommendation and the target price is Rs 1,597.
PTC Industries | Buy | Target Price: Rs 24,415
PTC Industries is expected to enter a period of accelerated growth as recently commissioned manufacturing facilities ramp up and its strong order pipeline converts into revenue.
Antique Stock Broking projects EBITDA of Rs 6.9 billion in FY28 and that it will go up to Rs 16.5 billion by FY30. Net profit is also expected to increase almost 12 times from Rs 1.0 billion in FY26 to Rs 12.2 billion by FY30.
With significant capacity expansion already completed and a robust order book providing revenue visibility, the brokerage maintained its Buy rating and raised its target price to Rs 24,415 per share.
Zen Technologies | Buy | Target Price: Rs 2,000
Zen Technologies has a strong position in defence simulation and anti-drone systems that are expected to see increasing demand in the wake of fast technology advancements in modern warfare.
The company’s order book was Rs 12.4 billion, a 64% year-on-year growth. Zen Technologies is also targeting an order book of Rs 25 billion by the end of FY27.
Antique Stock Broking expects positive momentum in both the simulator and drone/anti-drone businesses. It maintained its Buy recommendation while raising the target price to Rs 2,000 from the earlier target of Rs 1,805.
Solar Industries India | Buy | Target Price: Rs 21,408
Solar Industries India is still a preferred player in the defence and explosives space due to its position in industrial explosives leading to backward integration and geographical diversification.
Antique Stock Broking says rising global geopolitical tensions are driving countries to step up their defence preparedness, which could drive demand for high-energy materials and defence-related products.
The brokerage maintained its Buy rating on Solar Industries and raised its target price to Rs 21,408 per share.
Mazagon Dock Shipbuilders | Buy | Target Price: Rs 3,275
Mazagon Dock Shipbuilders are positioned to benefit from the expected ordering cycle of the Indian Navy. Antique Stock Broking expects the P75I submarine programme to make up for the recent decline in the company’s order book.
The brokerage sees a strong pipeline of orders in the medium term for P75I submarines, additional P75 submarines, Landing Platform Docks (LPDs), P17B frigates, Mine Counter Measure Vessels (MCMVs) and destroyers.
Follow-on orders for three additional Scorpene-class submarines and six P75I submarines could substantially increase Mazagon Dock’s order book and improve its revenue visibility in the medium term.
Antique Stock Broking maintained its Buy recommendation on Mazagon Dock Shipbuilders with a target price of Rs 3,275 per share.
Defence Stocks Outlook
The overall prospects for Indian defence stocks are still very much supported by several structural factors, including larger government procurement, indigenisation, exports and the growing use of advanced defence technologies.
The expected demand cycle extends from fighter aircraft and naval platforms to missiles, ammunition, drones, anti-drone systems and high-energy materials. Companies with high technological capabilities, proven manufacturing capacity and healthy order books will be among the most likely to benefit from the trend.
But investors should also consider valuation risks, execution timelines, order-concentration risks and the potential for volatility from sudden defence stock rallies. Brokerage targets are estimates and are subject to changes in earnings expectations, market valuations and business developments.
Investors should therefore evaluate these stocks based on their own risk profile and investment horizon instead of just on brokerage target prices.
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