The Nifty India Defence index rose 2.57% after record output and export growth in FY25.
Indian defense stocks climbed higher on Monday after the government announced record production for FY24-25. The Nifty India Defence index was up 2.57%.
Major players, including Hindustan Aeronautics (HAL), Bharat Dynamics, and BEML, were up between 2% and 3.6%. Paras Defence and Space Technologies was the top gainer, rising as much as 7.6%.
PSUs Lead Charge
India’s annual defense production reached a record high of ₹1,50,590 crore in FY 2024-25, marking an 18% jump from the previous year’s ₹1.27 lakh crore and a 90% surge from FY 2019-20’s ₹79,071 crore, according to a press release by the Ministry of Defence on Saturday.
Exports also increased to a record ₹23,622 crore in FY 2024-25, up 12.04% from ₹21,083 crore in the previous fiscal.
Minister of Defence, Rajnath Singh, credited the impressive feat to the Department of Defense Production, Defense Public Sector Undertakings (DPSUs), public sector manufacturers, and private industry, and highlighted the country’s expanding defense industrial base.
DPSUs and other PSUs contributed about 77% of the total output, while the private sector accounted for 23%, up from 21% in FY 2023-24. Production by DPSUs grew 16%, while the private sector registered a sharp 28% increase, helped by policy reforms, improved ease of doing business, and a decade-long push for indigenization. It also aligns with the Aatmanirbhar Bharat vision, which aims to reduce import dependency.
“With sustained policy support, increased private participation, and expanding export capabilities, India’s defence production sector is poised for continued acceleration in the years ahead,” the press release read.
Stock Watch: Paras Defence
Last week, Paras signed an agreement with Germany’s HPS GmbH to jointly develop deployable antenna reflector subsystems for satellites in India.
The antenna systems will serve applications such as satellite internet, earth observation, disaster management, and secure military communications. Paras will act as the exclusive Indian interface for HPS technologies, with potential plans for a joint venture and local manufacturing in the future.
According to Vishal Trehan, a SEBI-registered analyst at Aauriga Quantrade, the partnership marks a significant long-term strategic gain, strengthening its position in India’s indigenous space hardware ecosystem.
However, the stock’s short-term performance remains under pressure, likely due to profit booking and overall sector volatility.
Separately, BEML received its first-ever overseas contract in the rail and metro segment from Malaysia for the retrofit and reconditioning of the Mass Rapid Transport System.
India’s defense stocks have been in the spotlight lately. Last week, the Defence Acquisition Council (DAC) approved capital acquisition proposals worth around ₹67,000 crore to bolster the operational capabilities of the Indian Armed Forces, including the Army, Navy, and Air Force.
Overall, defense firms have seen strong gains in 2025, with the Nifty India Defense Index rallying over 20%.
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