DAC approves Rs 1.10 lakh crore defence acquisitions, lifting stock prices
India's Defence Acquisition Council gave in-principle approval to major military procurement plans totaling approximately Rs 1.10 lakh crore, triggering a surge in domestic defence equities and setting the Nifty India Defence index above 10,000.
Shares of Indian defence companies rallied on Tuesday following in-principle approval from the Defence Acquisition Council (DAC) for acquisition proposals valued at around Rs 1.10 lakh crore. Investors anticipated that roughly 98% of these purchases would originate from Indian vendors, addressing concerns over supply chain risks and export restrictions affecting foreign imports. Key performers included Mishra Dhatu Nigam (MIDHANI), which advanced 12.5%, Data Patterns, rising 7.6%, and Hindustan Aeronautics (HAL), up 4%. The Nifty India Defence index climbed to 10,012.95 before closing 2.5% higher. Ajit Mishra, SVP Research at Religare Broking, noted the approval enhances visibility for order inflows and underscores growth opportunities for domestic manufacturers. Gaurav Garg of Lemonn highlighted that sanctions have created a strategic reliance on foreign suppliers, making local sourcing critical amid ongoing geopolitical tensions in the region. The index had risen approximately 23% over the last six months compared to the broader market's decline.
