Prime Minister Narendra Modi delivered a speech to the nation on Monday regarding Operation Sindoor, emphasizing the success of domestically produced defense systems. This led to a surge in defense stocks on Tuesday, despite the overall market downturn. The Nifty India Defense index skyrocketed by 4.12 percent to reach 7,432.40, outperforming the benchmark indices. Bharat Dynamics stole the show in the defense sector by soaring 11.47 percent to close at ₹1,750 per share, marking its most significant single-day gain in a year. Following closely behind were Garden Reach Shipbuilders and Engineers (GRSE) and Zen Technologies, which witnessed gains of 5.21 percent and 5 percent, respectively. Other defense sector stocks also saw robust performances, with Bharat Electronics rising by 4.06 percent, Data Patterns advancing by 3.94 percent, and Cochin Shipyard climbing by 3.82 percent. Hindustan Aeronautics closed at ₹4,608.70 after gaining 3.81 percent. Modi’s address highlighted the performance of indigenous defense systems during Operation Sindoor, stating, “Today, the world is witnessing that in 21st-century warfare, the time has come for ‘Made in India’ defense equipment.”
Market analysts expressed optimism about the defense sector’s future prospects following the strong showing of domestic defense players during the recent India-Pakistan tensions. Vikas Jain, Head of Research at Reliance Securities, remarked, “Expect long-term positive on defense stocks after domestic defense players have shown strong performance in the India-Pakistan geo-political tension. Expect strong overseas order.” Kranthi Bathini, Director of Equity Strategy at WealthMills Securities, highlighted the government’s focus on defense and Make in India as key factors driving the defense sector’s growth. He mentioned, “The tailwinds and also the government focus towards defense and making Make in India is the key triggers for defense and also the other thing is right now defense companies have demonstrated their capabilities, so that is also adding some extra interest for defense stocks.” Bajaj Bajaj Broking Research added, “Defence-related counters saw strong accumulation, buoyed by renewed market enthusiasm around the indigenization of defense manufacturing and equipment.”
India’s defense exports reached a record ₹23,622 crore in FY25, marking a 12 percent year-on-year increase. Defense Minister Rajnath Singh has set an ambitious target of ₹50,000 crore in defense exports by 2029. The success of the defense sector in recent times has been attributed to the strong performance of indigenous defense systems and the government’s push for self-reliance in defense manufacturing. The positive outlook for defense stocks reflects the growing confidence in India’s defense capabilities and the potential for further growth in the sector. While uncertainties remain in the global geopolitical landscape, the resilience and adaptability of the Indian defense industry position it well for future challenges and opportunities.