DOMESTIC DEFENCE PRODUCTION
Reforms in armed forces should be continuous to maintain supremacy during wars: President Murmu
President Droupadi Murmu highlighted the government's efforts to boost domestic defence production. She claimed that nearly 70 per cent of defence procurement was sourced from Indian manufacturers in the last year, and reforms resulting in India manufacturing over Rs one lakh crore of defence equipment. She emphasised upon modernisation of the armed forces, the importance of continuous reforms for military supremacy, and India's increasing defence exports, including the BrahMos missile deal with the Philippines.
350th iDEX contract: MoD, SpacePixxel to work on design, development of miniaturised satellite
iDEX has significantly impacted the defence ecosystem by fostering start-ups, creating job opportunities, and facilitating procurement worth over Rs 2,000 crore, showcasing a commitment to innovation and technology advancement.
Chief of Air Staff urges prioritisation of modernisation for India's armed forces
Chief of Air Staff Air Chief Marshal VR Chaudhari emphasized the critical need for India to invest in modernizing its armed forces amid evolving security challenges during the Capstone Seminar organized by the Indian Air Force, the College of Air Warfare, and the Centre for Air Power Studies. He highlighted India's strategic culture, the importance of strategic partnerships, boosting indigenous defense production, and adopting a comprehensive approach to security in facing multifaceted challenges.
A record number of NATO allies are hitting their defence spending target during war in Ukraine
Over 20 NATO member nations are meeting the alliance's defense spending target, amidst concerns over Russia's war in Ukraine. NATO Secretary-General Jens Stoltenberg commended European efforts for collective security, ahead of a pivotal summit in Washington.
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.
Safeguarding India's border will remain topmost priority: Rajnath Singh
Defence Minister Rajnath Singh, retained in his role in the new government, reaffirmed India's commitment to safeguarding its borders and strengthening defence manufacturing and exports. Singh emphasized the priority of protecting India's integrity and sovereignty under the visionary leadership of Prime Minister Narendra Modi.
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Indonesia accepts South Korea warship donation, despite cost concerns
Indonesia's parliament has approved a proposal to accept a South Korean donation of a corvette for its navy, despite concerns about the vessel's age and the need for significant maintenance costs. The 36-year-old corvette, Bucheon 773, is seen as a boost to Indonesia's military capability, but it requires approximately $85 million for maintenance and additional costs before it can be operational. Defence Minister Prabowo Subianto has been advocating for upgrading Indonesia's military hardware, but his decision to procure used equipment has faced criticism.
Exit polls show Advantage BJP! D-Street to likely train its guns on these sectors
Exit polls favor Bharatiya Janata Party (BJP) led NDA faction. Sectors like railways, defence, infrastructure, and PSUs to gain focus. NDA expected to secure 350-plus seats in the upcoming election.
India's GDP grows 7.8 per cent in Q4, FY24 growth pegged at 8.2 per cent
India Q4 GDP: The analysts were anticipating a better-than-expected growth for the January to March quarter this time around. The Reserve Bank of India (RBI) estimated Q4FY24 real GDP growth to be 7 per cent while ET Poll suggested the growth rate of 6.8 per cent. As per a Reuters poll, the Indian economy was expected to grow at 6.7 per cent in the January-March quarter on a year-on-year basis, owing to weak demand.
Despite war needs, Israel's military should not get a 'blank check' -cenbank chief
Bank of Israel Governor Amir Yaron supported forming a committee to scrutinize Israel's defense budget, emphasizing that the ongoing war doesn't justify unchecked military spending. Since January, Yaron has advocated for fiscal adjustments to prevent budget deficits from escalating due to war costs. Prime Minister Netanyahu plans to increase defense spending by 20 billion shekels annually, despite a rising budget deficit. Finance Minister Bezalel Smotrich and Defense Minister Yoav Gallant agreed to establish the committee, aiming to balance security needs with economic stability, given the projected 250 billion shekels war cost from 2023 to 2025.
Defence stocks: Long runway, hedge a bit to avoid narrative-based decisions; 8 PSU & Pvt sector stocks, 4 with upside potential of upto 44%
In an election season, there are bound to be times when one or the other narrative may make one question about whether one should sell the stocks. The underlying reason would be fear of losing the gains on which one is sitting. Especially when it comes to sectors like defence, railways and others which have seen a strong re-rating and siting with big gains and already there has been skepticism about their stock price moving ahead of time. Now let's look at the issue in two ways, first is whether the fundamentals of the sector are on a strong foot and business is fine or not. Second, how to hedge the exposure so that one is not forced to sell due to narrative, because the fact is that a continuation in policy push means that the companies have just started their journey. While defence PSUs are well known, there are other private sector players, whose lifeline is dependent on defence expenditure and in the last few years they have also done well, both on the street and in terms of real business. So, it is better that one should hedge and stay with them and not get jittery because of one or the other narrative which will keep hitting the street till 4th June.
US on track to establish domestic rare earths supply chain for defence, official says
The US is on track to establish a domestic rare earths supply chain to meet its defense needs by 2027, according to a senior defence official. The US has been driving the build-out of a global supply chain for rare earths, metals used in magnets for green energy industries and defense, beyond dominant producer China since COVID upended global supply chains early this decade. Australia is classified as a domestic source of supply for critical minerals for the US under the Defense Production Act, and the US has been offering funding opportunities to Australian mine developers.
Should you add or buy defence stocks afresh? What to do with bank stocks? Deven Choksey answers
Deven Choksey discusses the potential tariff hike in the telecom sector and the strategies of Jio and Vodafone Idea. He emphasizes the importance of data consumption and the need for investments in infrastructure for companies to stay competitive in the market. Choksey also says: "The likes of Bajaj Finance, Kotak are looking like some of the smartest of the lot within the investment portfolio."
The small-cap landscape, while being challenging, looks somewhat better: Chirag Setalvad
Valuations have moved up but they have to be viewed in the context of the overall growth environment. Large-cap share valuations are at a relatively modest 10-15% premium to their historical averages.
Indian Army reduces ammunition imports, boosts indigenous production under 'Make in India' policy
The Indian Army has significantly reduced its dependency on imported ammunition thanks to the 'Make in India' policy. By leveraging private sector capabilities and public sector firms, the Army aims to cease most ammunition imports within a few years. This shift not only cuts import costs but also enhances export potential. Key industry players, including Munitions India Limited and Solar Industries Limited, play crucial roles in this transition, ensuring readiness for emergencies.
India's defence capabilities boosted under Modi government, relying on imports only for immediate needs: NITI Aayog member VK Saraswat
India has significantly enhanced its defense capabilities over the past decade, with a focus on indigenous manufacturing and reducing reliance on arms imports. VK Saraswat, a member of NITI Aayog and former chief of the DRDO, highlighted that 60% of India's arms and ammunition are now domestically produced, with major corporations like Adani, Tata, and L&T contributing to radar systems and gun manufacturing. Saraswat also assured that India's power capacity is sufficient to meet its needs, minimizing the risk of significant power cuts. Companies like Hindustan Aeronautics (HAL) and Bharat Electronics are poised to benefit from these trends.
Netweb Technologies starts commercial production at a new facility in Faridabad
Netweb Technologies launches high-end computing production at new Faridabad facility, aiming for Rs 2,000 crore turnover. Expansion plans include employee increase and international exports of Nvidia computers.
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.
Bet on PSUs only if bullish on India growth story; never in the short-term: Anand Sharma
Anand Sharma discusses the extensive impact of public sector enterprises in various sectors under government control, emphasizing the wide theme of PSU equity with a focus on power, oil, financials, logistics, metals, and mining. Sharma says , PSU equity fund is a thematic fund and should be a smaller part of any investors investable corpus.
TVS Electronics' new SMT line set to focus on defence and railways and other industries
TVS Electronics ventures into EMS sector for defence, railways and other industries with SMT line in Karnataka. It collaborates with global partners, integrating robotics and automation for advanced traceability and quality control.
India’s defence production is $13 bn and growing, and MSMEs are providing the tailwind
The government’s push for indigenisation in defence has encouraged smaller players to get into the game and reduce India’s dependence on imports.
Private sector's share in defence production reaches highest in eight years
Private sector companies in India have played a significant role in the country's defence production, contributing Rs 16,411 crore in fiscal year 2023-24, marking the highest share since 2016-17. Despite a decrease from the previous year, this contribution accounted for 22 per cent of the total defence production of Rs 74,739 crore. The government's push for local defence production, record high defence exports, and investments in defence corridors in Uttar Pradesh and Tamil Nadu aim to boost domestic manufacturing and reduce reliance on imports.
Guns N' Growth: Inside defence sector's explosive Make-In-India story
India's 'Make in India' defence production success story is evident in record-breaking defence exports, reaching Rs 21,083 crore in 2023-24, a growth of 32.5% from the previous fiscal. With a focus on indigenisation, India aims to triple annual defence production by 2028-29 and double defence exports to Rs 50,000 crore.
Germany could spend up to €9 bn more on defence from 2028, minister says
German Finance Minister Christian Lindner expects up to 9 billion euros ($9.7 billion) in additional defence spending from 2028 if Germany can reduce its debt levels. The additional funds could be freed up if Germany gets its debt below an EU-set target of 60% of gross domestic product from 63%. If Germany falls below this limit, the repayment of coronavirus debt planned from 2028 could be discussed again.
Jefferies sees 2x growth in domestic defence spends in next 5 years, bets on HAL, Data Patterns
For HAL, Jefferies has a 12-month price target of Rs 3,900, indicating an upside scope of nearly 13% from the current levels. For Data Patterns, the price target of Rs 3,545 implies an upside of more than 31% from the current price.
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.
Big gain for IAF: Govt clears next-gen fighter prototypes and development
The government has approved the development and prototype production of next-generation fighters for the air force, aiming to bolster the domestic manufacturing ecosystem and enhance the armed forces' combat capabilities. The Cabinet Committee on Security (CCS) greenlit the estimated Rs 15,000 crore proposal, advancing the project to the prototype production stage. The Advanced Multirole Combat Aircraft (AMCA), a fifth-generation fighter jet, is slated to take flight by 2028, featuring cutting-edge technologies like stealth capabilities, AI integration, long-range targeting, and compatibility with unmanned systems.
India cannot afford to remain dependent on defence imports: Rajnath Singh
India's Defence Minister, Rajnath Singh, has stressed the need for India to reduce its dependency on imported military hardware in order to maintain strategic autonomy. Singh highlighted the Modi government's focus on boosting domestic manufacturing and stated that the annual volume of domestic defence production has surpassed Rs 1 lakh crore, compared to around Rs 44,000 crore in 2014.
India's economic growth seen to ease to 6% in Q3 dragged by industrial sector: ICRA
India's Gross Domestic Product (GDP) is expected to moderate sequentially to 6.0% YoY in Q3 FY2024, according to credit rating agency ICRA. The moderation is attributed to the industrial and agricultural sectors, with a slowdown in government expenditure and an uneven monsoon impacting GDP growth. The contraction of 0.2% in total spending by the Indian Government and 25 states in the previous quarter may have dulled GDP growth.
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