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Shares of defence companies were buzzing in trade, surging up to 13 percent on July 5 after defence minister Rajnath Singh announced that the country’s defence production recorded the highest ever growth in 2023-24.
The value of production has reached Rs 1,26,887 crore in 2023-24, which is 16.8 percent higher than the value of production of previous financial year, the defence minister posted on social media platform X (formerly Twitter).
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Singh also stated that the government is committed to creating a more conducive regime for developing India as a leading global defence manufacturing hub.
Prime Minister Narendra Modi also complimented this achievement. “Very encouraging development. Compliments to all those who have contributed to this feat. We are fully committed to nurturing a supportive environment to further enhance our capabilities and establish India as a leading global defence manufacturing hub. This will enhance our security apparatus and make us Aatmanirbhar!,” he tweeted.
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Following the announcement, shares of defence companies like Bharat Dynamics, Bharat Electronics, Hindustan Aeronautics, Cochin Shipyard, and Data Patterns climbed higher in trade.
Back in mid-June, while assuming charge of the Defence Ministry for a second tenure, Rajnath Singh set an ambitious target to export over Rs 50,000 crore worth of defence equipment by 2028-2029.
Bullishness over the sector is also evident from the robust subscription numbers of the Motilal Oswal Nifty India Defence Index Fund. According to the asset management company’s announcement on July 4, the fund, which is the first domestic passive fund focusing on the sector, raised Rs 1,676 crore during its New Fund Offer (NFO) period. This amount marks the highest collection ever by an equity index fund during its NFO period.
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Furthermore, the Nifty India Defence Index has demonstrated impressive performance over the past one year and three years, achieving compounded annual growth rates of 177 percent and 89.5 percent, respectively, as of the end of May.
Also Read | Defence stocks on fire! HAL, Mazagon Dock, Paras Defence, Cochin Shipyard soar 6-20%
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