Guardians of growth: India's defence PSUs achieve 500 per cent surge in a year

In this Independence Day special, we list the top 6 PSU defence companies that have shown staggering growth over the past year.

India commemorated its 77th Independence Day on Tuesday. India has one of the most powerful militaries in the world and is crucial from a strategic perspective for the Indian government. An important area of the Indian economy is the manufacturing of defence products. Due to growing national security concerns and ongoing territorial disputes with Pakistan and China over control of the Northern State of Kashmir and the North Eastern State of Arunachal Pradesh respectively demand for defence equipment in India has increased. 

Yesterday India celebrated its 77^th Independence Day and today defence stocks have rallied up to 20 per cent.  

Make in India Push

To modernise its armed forces and reduce dependency on external dependence for defence procurement several initiatives have been taken by the government to encourage ‘Make in India’ activities via policy support initiatives. Some of the major defence manufacturing companies in India are Bharat Earth Movers Ltd, Bharat Electronics Ltd and Hindustan Aeronautics Ltd. 

As of 2021, India had the third-largest defence budget in the world. The Indian government has set a target for defence production of USD 25 billion by 2025 including USD 5 billion from exports. According to the Union Budget 2022–23, 25 per cent of the defence R&D budget has been set aside for start–ups and the private sector, paving the door for the development of new defence technology in India. Up until October 2022, 366 businesses working in the defence sector had received a total of 595 industrial licenses. Due to cooperative efforts, India today exports defence to over 75 countries a 334 per cent increase over the previous five years. 

As of today, Indian shipbuilding defence companies have experienced significant rallies. Garden Reach Shipbuilders & Engineers has surged by up to 19.20 per cent, Mazagon Dock Shipbuilders has seen a surge of up to 9.51 per cent, and Cochin Shipyard has risen by 19.49 per cent.  

Here is a list of the top 6 PSU defence companies that have shown staggering growth over the past year. The return data has been calculated from the closing of August 12, 2022, to the closing of August 14, 2023. 

Additionally, there is another privately held company in India's Defence and Aerospace Electronics sector that is among the fastest-growing namely Data Patterns (India) Ltd. This company has yielded a return of 150.91 per cent over the same period. 

Disclaimer: The article is for informational purposes only and not investment advice.