Defence stocks: Mazagon Dock, Cochin Shipyard gain as DAC nods Rs 1.44 lakh investments

Defence stocks zoom: The shares of the key defence equipment manufacturers including Mazagon Dock, Cochin Shipyard, Hindustan Aeronautics Limited, Garden Reach Shipbuilders, and others surged substantially after the Defence Acquisition Council (DAC) approved key investments to procure advanced indigenous defence equipment. 

The shares of Mazagon Dock Shipbuilders Limited surged as much as 6 per cent on Wednesday to touch the day high of Rs 4,764.65 along with Cochin Shipyard which also recorded a 5 per cent uptick. 

As of 11:01 am, HAL was trading nearly 2 per cent up whereas the shares of Garden Reach Shipbuilders were trading 3.5 per cent up. 

On Tuesday, under the chairmanship of Union Defence Ministry Rajnath Singh, the DAC approved the capital acquisition proposals amounting to Rs 1,44,716 crore under which the government will procure Future Ready Combat Vehicles, Air Defence Fire Control Radars, Dornier-228 aircraft, and Next Generation Fast Patrol & Offshore Patrol Vessels.

“For modernisation of the tank fleet of the Indian Army, the proposal for procurement of Future Ready Combat Vehicles (FRCVs) has been cleared. The FRCV will be a futuristic Main Battle Tank with superior mobility, all terrain ability, multilayered protections, precision & lethal fires over and real-time situational awareness,”  the official announcement stated.

According to the announcement, 99 per cent of the approved proposals are sourced from indigenous suppliers, aligning with the government's focus on self-reliance under the Buy (Indian) and Buy (Indian-Indigenously Designed Developed and Manufactured) categories.

The DAC has also greenlit the acquisition of Air Defence Fire Control Radars. These radars are designed to detect and track aerial targets while providing accurate firing solutions, enhancing the Army's air defence capabilities. Additionally, the council has approved the procurement of Forward Repair Teams (Tracked), which will enable in-situ repairs during mechanised operations, thanks to their cross-country mobility.