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Business News/ Markets / Stock Markets/  HAL, Bharat Electronics, Bharat Dynamics: 4 key factors that keep 2024 outlook firm for Defence PSUs as per Antique

HAL, Bharat Electronics, Bharat Dynamics: 4 key factors that keep 2024 outlook firm for Defence PSUs as per Antique

Outlook 2024- Defence Public Sector Undertakings as Hindustan Aeronautics, Bharat electronics, Bharat Dynamics have seen gains of 81-121% during 2023. Here are four reasons that keep their outlook strong during 2024 as highlighted by Antique Stock Broking

Defence PSUs : 4 key reasons that keep outlook firm for HAL, Bharat Electronics, Bharat DynamicsPremium
Defence PSUs : 4 key reasons that keep outlook firm for HAL, Bharat Electronics, Bharat Dynamics


Outlook 2024: The Defence sector companies riding the wave of strong growth led by favorable government policies on “Make in India" and "Atmanirbhar Bharat" initiative have seen strong gains in their share prices during 2023. Share prices of Hindustan Aeronautics Ltd, Bharat electronics Ltd, Bharat Dynamics Ltd saw gains of 81-121% during 2023. The order flows remain strong keeping outlook firm moving forward too.

Analysts at Antique Stock Broking in their report have said that Calendar year 2023 ended on a high note, setting a bullish tone for Calendar year 2024. With defence production and exports expected to reach all-time high levels in FY24, the sector is all set to experience an equally strong FY25.

Also Read- TCS, Infosys to Wipro: What market expects from IT majors in Q3 results 2024?

Here are four fundamental reasons why Antique Stock Broking expects more gains

Defence Acquisition Council (DAC) has cleared Acceptance of Necessity (DAC) for projects worth 3.5 trillion in CY23- To enhance the operational preparedness of the armed forces, DAC has approved AoN worth 3.5 trillion as against 2.6 trillion in FY23 leading to 35% YoY growth.

Defence production set to scale all-time high levels in FY24: Defence production in India for FY23 stood at more than 1 trillion and the government’s intent is to further boost domestic production to 1.5 trillion in FY24. Multiple policy initiatives set by government to ramp up domestic production include reserving 75% of the defence capital procurement budget for the domestic industry in FY24, up from 68% in FY23; Issuing five positive indigenization list, products under which will be banned from imports and Integration of MSMEs and start-ups into the defence supply chain.

Defence exports expected to report 26% growth in FY24: Export is one of the key focus areas and multiple steps have been taken to scale it up. Exports have reached 160 billion in FY23 (10 times since FY17). it is further expected to reach 200 billion (up 26% YoY) in FY24.

A strong defence ecosystem being developed through defence corridors: Two Defence Industrial Corridors (DIC) have been established in Uttar Pradesh and Tamil Nadu to boost the defence manufacturing ecosystem in the country with the intent to attract investments of 100 crore in each Defence Industrial Corridors. 

Also Read- Cement Q3 Preview: Volumes growth, costs to moderate as price hikes aid earnings

Sector Outlook- Analysts at Antique said that the Defence PSUs benefit immensely as Ministry of Defence goes on order finalization drive. MoD has placed multiple large ticket orders with defence PSUs which has helped Defence public sector undertakings (DPSUs) like Hindustan Aeronautics , Bharat electronic, Bharat Dynamics to further bolster their already strong order book and meaningfully increase revenue visibility for years to come.

They continue to believe in the robust ordering prospects which is expected to play out in the medium term as India looks to modernize its armed forces and also scale up exports with emphasis on Make in India

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions

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Ujjval Jauhari
Ujjval Jauhari is a deputy editor at Mint, with over a decade of experience in newspapers and digital news platforms. He is skilled in storytelling, reporting, analysing and writing about stocks, investment ideas, markets, corporates and more. He is based in New Delhi.
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Published: 11 Jan 2024, 01:21 PM IST
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