Defence shares got a boost after the Defence Acquisition Council (DAC) approved eight major capital acquisition proposals worth more than Rs 54,000 crore. These acquisitions will improve the functionalities of the Indian Army, Navy, and Air Force.
The DAC has approved the Acceptance of Necessity (AoN) for the Army to procure engines with 1,350 horsepower (HP) for T-90 tanks, which will replace the existing 1,000 HP engines. In accordance with the Ministry of Defence’s ‘Year of Reforms’ initiative for 2025, the DAC has also authorized new guidelines designed to simplify the capital acquisition process. The updated framework is expected to cut short procedural delays, resulting in quicker and more efficient procurements.
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Following the approval, the share prices of Unimech Aerospace and Manufacturing jumped as much as 8% intra-day. The stock of DCX Systems traded almost 7% higher at Rs 255.60. The share price of Bharat Dynamics rose to the day’s high of 5.7% to Rs 1,317.65.
Avantel’s stock price surged 5.6% to the day’s high of Rs 123.46. It came off intra-day highs to trade 3% up at Rs 120.53 at 1.40 PM. The share price of Kaynes Technologies rose more than 4% to an intraday high of Rs 4,839.75.
Other defence stocks like HAL, MTAR Technologies, Data Patterns, Ideaforge Technology, Astra Micro, and many others were trading in the green following the approval.
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Other than that in the same field, drone-related stocks gained. DroneAcharya Aerial Innovations hit a 5% upper circuit limit at Rs 67.96. Zen Technologies shares surged 1.73% at Rs 1,315. The increase in these stocks followed the expectation that the Goods and Services Tax (GST) Council would declare a standardized 5% GST rate for all drones used commercially in its forthcoming meeting. This decision is anticipated to eliminate the uncertainty related to the categorization of unmanned aircraft systems (UAS), or drones, and provide essential clarity for the industry.
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