1 / 8Brokerage firm Motilal Oswal has maintained its “buy” recommendation on four Indian defence companies, Bharat Electronics (BEL), Hindustan Aeronautics (HAL), Bharat Dynamics (BDL), and Astra Microwave, for up to 38% upside, in its note on Tuesday, March 10.
(Photo Credit : The Turkish Ministry of National Defence reported no casualties in the downing of the missile [File: Khalil Hamra/AP Photo])
2 / 8The brokerage said that the current West Asia conflict is likely to drive higher global defence spending as nations will prioritise security and military preparedness. It added that India’s defence sector is well positioned to benefit from both rising domestic procurement and increasing export opportunity, supported by the government’s push for indigenization and a growing reputation in the global arms market.
3 / 8Motilal Oswal also warned that in the near-term, it will watch for supply chain constraints, particularly related to specialized components and imported subsystems, which could affect the execution timelines of certain defence platforms.
4 / 8Management commentary across key defence companies points to strong visibility for order finalization over the next 15-18 months, backed by large, named programs at advanced stages. Based on this, it has recommended buying these four companies:
5 / 8Bharat Electronics | The company has highlighted near-term opportunities, including the LCA Mk-1A systems, Shatrughat EW, next-gen Corvettes, and expected QRSAM inflows worth nearly ₹30,000 crore. Motilal Oswal’s “buy” rating on the stock values it at 45 times two-year forward earnings and its price target of ₹520 implies an upside potential of 14% from current levels.
6 / 8Hindustan Aeronautics | The company is expected to begin deliveries Tejas Mk-1A and has secured orders such as the Dornier-228, Dhruv-NG and ALH Mk-III. The stock has declined significantly from its previous peak and Motilal Oswal’s price target of ₹5,500 implies an upside potential of 38% from current levels at 30 times two-year forward earnings.
7 / 8Bharat Dynamics | The company is targeting orders worth nearly ₹20,000 crore over the next 18 months from a ₹50,000 crore pipeline, supported by advanced trials of Akash-NG and other missile systems, Motilal Oswal note. The brokerage has a price target of ₹1,800, implying a potential upside of 35% from current levels, based on 42 times two-year forward earnings.
8 / 8Astra Micro | Motilal Oswal said that Astra Micro remains well-positioned for QRSAM and EW-linked electronics opportunities, which, in the long-term could be worth nearly ₹25,000 crore. The price target of ₹1,150 on the stock implies an upside potential of up to 15%, based on 38 times two-year forward earnings.
