Defence Stocks Rally For Second Day In EarTrade As FY26 Production Hits Record ₹1.78 Lakh Crore

Shares of defence companies extended gains for a second consecutive session in early trade on Thursday after the government reported record defence production for FY26, boosting investor interest across the sector.

Paras Defence & Space Technologies shares rose 5% in intraday deals to a fresh 52-week high of ₹1,348.40 on the National Stock Exchange (NSE). The stock has gained 24% over the last two trading sessions. At 1:48 pm, Paras Defence & Space Technologies shares were up 0.37% on the NSE.

Other Defence Stocks Followed The Same Trend

The broader rally lifted several defence counters. Shares of Garden Reach Shipbuilders & Engineers (GRSE) and Data Patterns (India) climbed 7-8% over two sessions in early trade. Bharat Electronics (BEL), Cochin Shipyard, Hindustan Aeronautics (HAL), Mazagon Dock Shipbuilders, Bharat Dynamics (BDL), Zen Technologies, Solar Industries India and Dynamatic Technologies shares gained 4-6% during the same period.

Astra Microwave Products and MTAR Technologies emerged among the stronger performers, rising as much as 11% in two sessions in intraday deals.

The rally pushed the Nifty India Defence index up around 5% over two days to 9,568 on Thursday in early trade, even as the broader market traded in a narrow range. Here is how the shares of the above-mentioned companies and the Nifty India Defence index stood at around 1:51 pm (see table):

Defence Production Rises 15.6% In FY26

The gains came after the Ministry of Defence said on Wednesday that India's indigenous defence production reached a record ₹1.78 lakh crore in FY26.

The figure marks a 15.6% increase from ₹1.54 lakh crore reported in FY25. Compared with FY21 production of ₹84,643 crore, the latest number represents growth of more than 110%.

According to the ministry, public sector undertakings accounted for nearly 76% of total production during FY26. The private sector increased its share, contributing ₹42,000 crore, up from its share in FY25.

The ministry said the sustained rise in domestic production has also supported record defence exports of ₹38,424 crore in FY26. It attributed the growth to the government's push for self-reliance in defence manufacturing under the Aatmanirbhar Bharat programme.

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Government Highlights Defence Manufacturing Push

In a post on social media platform X, the Ministry of Defence said India is strengthening its security architecture through expanded border protection capabilities, improved counter-terror measures and rapid growth in indigenous defence manufacturing.

Defence Minister Rajnath Singh said the country has undergone significant changes in its national security framework over the past 12 years under Prime Minister Narendra Modi's leadership.

Singh said India's policy approach against terrorism has been backed by decisive actions, including surgical strikes and the Balakot operation, reinforcing the country's stance on protecting its sovereignty.

He also said the government's focus on self-reliance has helped strengthen domestic defence capabilities, modernise the armed forces and improve preparedness across land, sea, air, cyber and space domains.

The production data and continued policy focus on domestic manufacturing kept defence stocks in demand, with investors extending bets across both public sector and private defence companies.

Sources:

The Economic Times

Livemint