DEFENCE WEAPONS MANUFACTURING
Don't write off Modi stocks: More than half are back in full throttle, budget may bring more tailwinds for them
It has been a sort of tradition that the last full budget of any government and also the interim government is focussed on garnering votes and generally fiscal prudence is kept aside. But in the case of the Modi government, both in the last full budget presented in 2023 and interim budget presented in 2024, fiscal prudence was maintained. Given that government revenues are on strong footing, even if the government announces some measure which on face of it might look to be politically correct. There is little chance that fiscal prudence would be kept aside and that is what matters in the end to the street. So, there is a possibility that Modi stocks, which have been the star performers in the first five months of 2024, will be back in the limelight. Don't write them off. More than half of them are already higher than what there was before the election results came in. The policy push may continue for lots of sectors which have been the focus area of this government.
Underwater-launched UAV & more: DRDO sanctions seven new projects to private sector companies
DRDO's Technology Development Fund projects include simulator training tools by Oxygen 2 Innovation, ISR and MDA underwater vehicles by Sagar Defence, icing sensors by Craftlogic Labs, radar processors by Data Patterns, advanced timing systems by Accord Software, and graphene-based e-textiles using advanced nanocomposite materials by Alohatech. Aims to bolster India's military industrial ecosystem.
Forgot Modi stocks? Numbers indicate don't write them off. 26 are already back. Budget tailwinds may bring more of them back to limelight again
Just before the election results were announced, some domestic and foreign brokerages came out with a report about a set of stocks which were called Modi stocks. The number varied from 50 to 55 stocks. The reason why they were called modi stocks was the fact that these stocks were from sectors which were expected to get renewed policy push once the third term of the Modi government started. This list had stocks which would power data centers, which is essentially an AI play to green energy stock to PSU stocks from sectors which were getting strong policy push. But then political arithmetic turned different and everybody forgot about them. One month later, if one looks at them, it is clear that while the term “ Modi stocks” might be off the headline, in terms of performance, the picture is very different from what most have been thinking. It is far better and there is a high probability that it might get better.
UP defence corridor attracts Rs 25,000 crore in deals through 154 MoUs, propels industrial growth
Uttar Pradesh has signed more than 150 defence manufacturing deals worth ₹25,000 crore, focusing on boosting India's defence production and exports. The projects, part of the UP Defence Industrial Corridor, will create 40,000 jobs across six districts. With notable companies like Adani Defence and BrahMos Aerospace involved, the initiative aims to propel the state's industrial value chain and support India's self-reliance in defence. Significant milestones include the delivery of AK-203 rifles and the development of a BrahMos missile plant.
McLaren to partner with British Defence Ministry in its hypersonic missile development program
Car manufacturer McLaren has announced its collaboration agreement with the British Defence Ministry. The two sides will partner on the development of hypersonic missiles. McLaren will not actually develop any missile.
Explosive growth: How defence sector became a darling of investors
Motilal Oswal Nifty India Defence Index Fund breaks records by collecting Rs 1,676 crores during its NFO period. India's defence sector experiences growth through indigenisation efforts and increased investments. The country aims to enhance its defence production capabilities and boost exports in the coming years.
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Big Boost to Rudra and Prachand helicopters: Adani Defence and Thales Group to manufacture 70mm rockets in India
Adani Defence & Aerospace has partnered with Thales Group to produce 70mm rockets in India, supporting the "Make in India" initiative. This collaboration aims to enhance India's defence capabilities with locally produced rockets for HAL Rudra and Prachand helicopters, while also boosting the country's defence manufacturing sector and creating employment opportunities.
ASMI submachine gun from Hyderabad's Lokesh Machines Ltd. poised for Army service
Lokesh Machines Ltd., known for CNC machines, achieves a milestone with its ASMI submachine gun, the first domestically designed and manufactured weapon to be officially inducted into the Indian Army. The ASMI has received orders from the Northern Command for 550 guns and positive feedback from security forces. It has outperformed international competitors in accuracy and reliability, featuring a lightweight design and compatibility with both local and NATO-standard ammunition. Priced under Rs 1 lakh, it is cost-effective and versatile for various military roles, reflecting India's progress in defence manufacturing and self-reliance.
Defence minister Rajnath Singh Sets ₹50k-cr military export target
Rajnath Singh, the Defence Minister, aims to boost military exports to Rs 50,000 crore annually under the 'Make in India' initiative. He plans to fast-track defence production schemes and enhance indigenous research and development. The ministry is set to establish a new defence export promotion agency to facilitate arms sales to countries like the Philippines, Vietnam, and Armenia. Singh emphasizes equipping the armed forces with advanced weapons for national security and self-reliance in defence manufacturing.
Armed forces ready to face every challenge: Rajnath Singh after taking charge of defence ministry for second term
Defence Minister Rajnath Singh outlined the new government's focus on bolstering national security by modernizing the armed forces and enhancing domestic defence production. He aims to increase defence exports to Rs 50,000 crore by 2028-29. Singh praised the armed forces for their readiness and commitment amid challenges, including the border row with China. The government will also focus on boosting India's defence production and welfare of soldiers. Singh conducted a meeting on the ministry's first 100 days' Action Plan, emphasizing self-reliance in defence and welfare of veterans.
Bangladesh military complains about faulty Chinese parts
Bangladesh, a major buyer of weapons from China, has accused Chinese companies of supplying faulty parts and technical problems with its imported military hardware. The Bangladesh military has accused Chinese companies of supplying faulty spare parts for corvettes, petrol crafts, and onshore patrol vehicles, with manufacturing defects and technical challenges. The Bangladesh Air Force has alleged technical problems with Chinese-made F-7 fighter jets and short-range air defense systems, and has faced issues with firing ammunition for its Chinese-made K-8W aircraft.
India-US discussions underway for $3.9 billion MQ-9B drones acquisition
A team from the United States is currently in India engaging in discussions regarding the acquisition of MQ-9B drones by the armed forces. The deal, estimated at $3.9 billion, has not been finalized as talks on technology sharing are still ongoing. Sources reveal that a team from General Atomics is in the capital for negotiations on the purchase of 31 drones, with 15 designated for maritime roles.
Indian weapons falling into wrong hands? Defence Ministry tightens monitoring
The defence ministry is enhancing monitoring of defence equipment production and requiring companies to adhere to end-user certification rules for exports. The sector has seen a surge in arms and weapons production, particularly in response to the Ukraine-Russia crisis.
Sri Lanka in talks with India to set up small arms manufacturing unit: Premitha Tennakoon
Sri Lanka is in discussions with India to establish a small arms manufacturing unit, as part of their defence cooperation. State Minister of Defence Premitha Bandara Tennakoon said the discussions are ongoing and a joint venture in the military industry. The Indian envoy in Colombo, Santosh Jha, stated that India would be willing to make these capabilities available to Sri Lanka.
Defence stocks: Stay bullish, just hedge a bit to avoid narrative-based decisions; 4 stocks with upside potential of up to 33%
One of the sectors which has seen strongest re-rating in the last four years has been defence. Now in the last few days, the way markets have corrected and a narrative has come on the street that it is poll jitters which is making FPI sell, without realizing the fact that after a strong phase of upward movement, the global money tends to move in one from one country to another, especially in emerging market segment, it might lead to a situation where one might end up selling the long term winner early because of the narrative. Rather than getting jittery, it would be better to create a hedge and stay with the stocks where there has been a big change in the fundamental ways things operate.
Effective defence-industry ecosystem taking shape in the country: Gen Pande
Gen Manoj Pande highlights the importance of integrating veterans into the defence-industry ecosystem, emphasizing their unique skills and experiences for technological solutions required by the Indian Army.
Shot by shot, Indian military is getting atmanirbhar
The government aims to increase India's annual defense production to nearly three times its current level, reaching Rs 3 lakh crore by 2028-29. Additionally, the target for defense exports is set to more than double, reaching Rs 50,000 crore compared to the current Rs 21,083 crore. For the fiscal year 2024-25, the goal is to achieve a total annual defense production worth Rs 1,75,000 crore, including exports valued at Rs 35,000 crore.
Recent geo-politics shows nations won't hesitate to go to war: Manoj Pande
The top officer said that there is a need for partnering with the industry to develop new technologies for future wars and creating 'national champions' to develop a strong defence industry eco system at the scale of global arms manufacturers.
Good times for merchants of death
Global defence industry shifts as US dominates amid conflicts. Countries pursue local production due to US unreliability. China, India aim for self-sufficiency, unsettling arms market. Sanctions distort trade, favoring US. Merchants profit in turbulent times.
South Korea, Romania pledge defence cooperation amid reports of contract in works
South Korea and Romania have pledged to enhance defense industry cooperation, including joint production of weapons, as South Korea aims to become the world's fourth-largest arms exporter. South Korea's Hanwha Aerospace is reportedly in talks for a 1 trillion won ($725.7 million) deal to supply K9 howitzers to Romania, its first defense contract with the country. Meanwhile, Poland is set to sign a $1.6 billion contract for 70 Chunmoo rocket artillery units from Hanwha Aerospace, as part of its $22 billion arms purchase from South Korea.
A look at Iran's military capabilities as it threatens Israel
Iran's military faces regional tensions with Israel, retaliating against attacks. Possessing drones, missiles, and air defenses, it lags behind global powers in air force and sophisticated weaponry. The conflict between Iran and Israel remains a focus of international concern.
HAL reports record revenue, pvt cos take lead as def exports cross ₹21k cr
Private companies drive Indian defence exports to record figures, with HAL recording its highest-ever revenue growth. New export partners contribute to the growth, with the government targeting ₹1,75,000 crore in defence manufacturing by 2024-25.
Dept of defence production issues notification for reorganisation of DGQA
The ministry said in a major reform towards "ease of doing business and to achieve 'Aatmanirbharta' in defence", the Department of Defence Production, under the Ministry of Defence, has issued notification for reorganisation of DGQA which is aimed at speeding up quality assurance processes and trials, and reducing layers of decision-making.
Ukraine ramps up spending on homemade weapons to help repel Russia
Ukraine is boosting its defense industry to fight Russia, investing heavily in local weapon production. The government budgeted nearly $1.4 billion in 2024 for homemade weapons, 20 times more than before. Private factories are now crucial, making thousands of shells monthly. This shift aims to counter Russia's dominance. However, Ukraine faces challenges like bureaucracy and manpower shortages. Despite this, its drone industry has thrived. The conflict hinges on resources and how well Ukraine uses them, as massive Western support remains crucial for its defense.
Why is Japan changing its ban on exporting lethal weapons, and why is it so controversial?
Japan's Cabinet approved selling future fighter jets to other countries, marking a shift from its pacifist principles. The decision aims to boost Japan's arms industry and global influence. The new fighter jet, developed with Italy and the U.K., will enhance Japan's defense capabilities. The move is influenced by regional tensions and aims to strengthen Japan's military role.
India Playbook 2024 – the India defence equity market story
Indian defence sector stocks excel globally, benefiting from geopolitical risk, domestic manufacturers' rise, and strong order books. The sector shows resilience amidst global market fluctuations and government's increased defense expenditure, positioning for sustainable growth. India's aerospace industry has many legs of growth and Hindustan Aeronautics is the key player in the space.
Saab breaks ground for first 100% FDI in defence facility
Speaking after the groundbreaking ceremony, a senior Saab executive said that the new initiative is a completely Indian company and will be qualified to participate in 'Make in India' procurements of the armed forces in future. "Today is an important milestone for Sweden and India. Saab's factory will be the first foreign fully-owned defence production facility in India. It is a testament to the strong bilateral relationship between our countries," Hakan Jevrell, state secretary for foreign trade, Sweden, said.
Saab commences construction of plant for production of new Carl-Gustaf weapon systems in India
Saab to produce Carl-Gustaf M4 weapon systems in Haryana, India starting next year. The company received approval for 100% FDI for the project in October. Construction of the 3.6-acre facility in Jhajjar has begun. This is Saab's first manufacturing unit for Carl-Gustaf M4 outside Sweden. The facility will employ around 100 people and will fully meet 'Make in India' requirements. Saab plans to start production next year, partnering with Indian suppliers. The Carl-Gustaf system has been in service with the Indian Army since 1976.
Getting ready for another round of re-rating ? 6 defence stocks with “buy” recos with upside potential of up to 34%
As other sectors dominated by PSU companies come into limelight, defence stocks which ignited the re-rating of PSU stocks have moved into consolidation mode for some time. The question is whether the business is in consolidation mode or not, the answer is tilting toward no. It appears the underlying developments in the sector continue to be going at the same pace or rather even more. Allowing 100 % FDI in space related industries, is probably an indication that focus on defence and related sectors continues. As things are shaping up, it appears the exports would also become a focus area.
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