Shipping stocks, including Mazagon Dock and GRSE, experienced a significant rally on September 3, following reports that the Defence Acquisitions Council (DAC), chaired by the Defence Minister, is likely to approve defense deals worth Rs 1.3 lakh crore. This includes a substantial order for seven new naval warships, estimated to be around Rs 70,000 crore.
This expected approval has sparked optimism in defense-related stocks, signaling increased government spending and strategic investments that are anticipated to benefit key players in the shipbuilding sector. Shares of Mazagon Dock soared by 7%, while Garden Reach Shipbuilders & Engineers (GRSE) rose 6%, and Cochin Shipyard gained 3.84%, trading at Rs 1,922.40 on the NSE.
The broader interest in defense stocks has been further fueled by Hindustan Aeronautics (HAL) securing a Rs 26,000 crore order. Additionally, the Indian Navy is expected to receive a significant boost in the coming months, with the approval of indigenous construction for three more Kalvari-class submarines by the end of the year.
As the Indian Navy seeks to enhance its capabilities amid a deteriorating strategic environment in the Indo-Pacific, the DAC may soon be approached to build advanced Project 15-class destroyers, equipped with anti-ballistic missile systems and drone launch capabilities.
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