The Bharat Forge reports that the ban could provide additional impetus to India’s defense companies are Bharat Heavy Electronics Limited (BHEL), Larsen & Toubro, Hindustan Aeronauttics Limits (HAL).
Throughout the opening exchange of Monday, security firms’ securities were exchanged higher after the Minister of Security declared the weekend prohibition on 101 combat and defense arms.
As an extra boost may be provided to Indian defense firms by Bharat Heavy Electronics (BHEL), Larsen & Toubro, Hindustan Aeronautics Limited (HAL), and Bharat Forge, allegedly purchased as a prohibition.
Hindustan Aeronautics Limited ‘s share of Rs 1039.5 has now reached its 52-week high, rising 9.66% of BSE after it was opened to 9.19%. The total travel time of stocks reaches 5, 20, 50, 100 , and 200 days. In one week, the share rose 14%, in one month 8.4% and in the first few months of the year 39%.
In the same direction, with a 2.13% rise, today’s share price of BHEL opened and was later influenced by an intraday peak of Rs 37.6, up 6.67% on BSE. After 2 days of successive decline, stocks have grown.
Following news of a prohibition on big ticket products such as Light Combat Aircraft (LCA) MK I A, shareholder aircraft makers were trading higher.
After launching today Larsen and Toubro shares have been listed as the highest gainers on the NSE. In one week L&T stock price was 5% and in one month it was 3,17%.
Similarly, Bharat Forge stock price opened at 5.89% and was later affected by an intra-day height of Rs 434.8, an increase of 6.57% on BSE.
The stock of Cochin Shipyard also decreased by 3,42% and was later influenced by intraday Rs 350. It decreased 5,53% in BSE. In one week, the stock of one of the few suppliers of products for the Indian Navy has increased by 5.8% and in one month by 5.16%.
In view of the increase in defense stocks, experts suggested that if this government’s prohibition initiative results in new order flows for the firms which cater for the defense room, their effect will be understood.
This policy would allow domestic defence, utilizing their own design and development skills by relying on technology established by the military research and development organization, an incentive to produce products on the negative list.
“Ashok Leyland, Bharat Forge are the kind of companies that could gain traction and these are the firms that have focused on this sector for a long period. The challenge, however, has been the execution because of various bureaucratic reasons,” Abhimanyu Sofat, Head of Research, IIFL Securities told Financial Express Online. Sofat added that government companies like HAL, Bharat Dynamics stand to gain along with BEL, BEML and Bharat Forge. “These developments are a step in the right direction given the inclusive approach and better clarity. However, for higher private sector commitment, decision making and execution with respect to pace of ordering, funds availability and seamless-integration across value chain remain key to success,” said Edelweiss Securities.