Additionally, the report highlighted select names such as Bharat Dynamic Ltd (BDL), Solar Industries, and Azad Engineering, which are expected to post even higher growth in the range of 25–30%, the brokerage highlighted in its June defence sector digest.
ICICI Securities has also named its top stock picks in the sector, listing Solar Industries, Astra Microwave and Azad Engineering as its top picks in the private space. Among defence public sector undertakings (DPSUs), it prefers Hindustan Aeronautics Ltd (HAL), Bharat Electronics Ltd (BEL) and Midhani.
Here are the key highlights of the report from ICICI Securities:
Strong order visibility across the board:
As per the brokerage, order inflows remain robust for FY26, backed by approvals under the Ministry of Defence’s emergency procurement route and capital acquisition programmes post Operation Sindoor.
According to the report, the Indian government has approved Rs 400 billion for emergency procurement (EP) and DAC has approved AoN (Acceptance of Necessity) for 10 proposals worth Rs 1,050 billion.ICICI Securities noted that specific companies have provided forward-looking order book guidance for FY26:
- BEL is expecting order inflow (OI) of Rs 200–250 billion (excluding the QRSAM order),
- HAL is expecting OI of >Rs 1 trillion, which includes projects like Su-30 upgrade, Tejas Mk-2, and RoH orders,
- BDL is guiding for OI of >Rs 50 billion,
- GRSE is expecting new-generation corvette orders of Rs 250 billion,
- Midhani expects OI of Rs 12–13 billion,
- Zen Technologies is expecting OI of Rs 8 billion in H1FY26, and
- Astra Microwave is expecting OI of Rs 13–14 billion.
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Key developments for June 2025
The report also compiled several critical developments shaping India’s defence manufacturing and procurement ecosystem:
- HAL was declared the winner for the Transfer of Technology (ToT) bid for ISRO’s small satellite launch vehicle (SSLV) and signed an agreement with France’s Safran Aircraft Engines for LEAP engine components.
- BEL received multiple orders, including one worth Rs 5.28 billion for radars and communication equipment, and another of Rs 5.85 billion for fire control systems and missiles.
- GRSE was declared L-1 in a next-gen corvette project and also signed a contract for two coastal research vessels.
- Solar Industries received a Nagastra-1 order worth Rs 1.58 billion.
- Kalyani Strategic Systems emerged as the lowest bidder for an Rs 20 billion contract to supply 4.5 million rounds of 5.56×45 mm carbines.
- IdeaForge received an Rs 1.37 billion mini-UAV order from the MoD.
- Reliance Defence secured an Rs 6 billion export order from Germany’s Rheinmetall.
- PTC Industries signed an MoU with Safran to manufacture aircraft engine components.
Strategic collaborations and investments
Several defence and aerospace players entered strategic collaborations during the month:
- Mahindra Aerostructures signed a USD 300 million contract with Spain’s Aernnova Aerospace to manufacture components for Airbus and Embraer.
- Bharat Forge partnered with Turgis & Gaillard of France to offer the AAROK UAV to Indian forces.
- Max Aerospace signed an MoU with the Maharashtra Government to set up a helicopter manufacturing unit in Nagpur with an investment of Rs 80 billion.
- Dassault Aviation joined hands with Tata Advanced Systems to manufacture Rafale fuselages for India and export markets.
Procurement and capability boosts
The Indian Army signed 13 contracts worth Rs 19.81 billion under emergency procurement and issued RFIs for 4,000 advanced anti-tank mines and 155mm precision-guided munitions. Additionally, the DRDO licensed ToT to Bharat Forge for its 155mm mounted gun system.
Emerging companies also made notable progress, including:
- Zen Technologies, which acquired TISA Aerospace Pvt. Ltd and secured a patent in laser-based combat training.
- QNu Labs, which received a Rs 250 million grant for quantum positioning systems.
- Space Pixel, which will supply hyperspectral satellites to the Indian Air Force.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
