HAL, Defence Stocks Rise After Government Clears Rs 45,000 Crore Procurements
These procurements will be made from Indian vendors and will give a substantial boost to the defence industry.
Shares of defence equipment and related companies advanced on Monday after the Ministry of Defence cleared nine procurement proposals worth Rs 45,000 crore for the armed forces.
The Defence Acquisition Council accorded the acceptance of necessity for the procurement of 12 Su-30 MKI aircraft with associated equipment from Hindustan Aeronautics Ltd., according to a release by the PIB on Friday.
The council also cleared the procurement of the Dhruvastra short-range air-to-surface missile, light armoured multipurpose vehicles, and an integrated surveillance and targeting system.
These procurements will be made from vendors under the buy indigenously designed, developed, and manufactured or buy (Indian) category, which will give a substantial boost to the defence industry towards achieving the goal of a self-reliant India, the PIB release said.
Though the names of any other company winning a particular order were not revealed in the release, here is how the stocks of listed defence companies that are directly or indirectly engaged in the production of such equipment performed.
Shares of HAL was trading 1.73% higher at Rs 4,016 apiece after rising as much as 4.14% during the day, compared to a 0.08% decline in the benchmark NSE Nifty 50 as of 10:03 a.m.
The stock has gained 58.5% on a year-to-date basis. The total traded volume so far in the day stood at 3.1 times its 30-day average. The relative strength index was at 57.
Nine out of the 11 analysts tracking HAL maintain a 'buy' rating on the stock, one recommends a 'hold', and another suggests a 'sell', according to Bloomberg data. The average of 12-month price targets given by analysts implies an upside of 6.4%.