DAC Nod To Five Key Defence Aquisitions - How Defence Sector Stocks Reacted

The Defense Acquisition Council (DAC), under the chairmanship of Defense Minister Rajnath Singh on December 03, 2024, accorded Acceptance of Necessity (AoN) for five capital acquisition proposals amounting to over Rs. 21,772 Crores. An AON necessarily means that the government has given in-principle approval to the procurement of defence hardware. Under the latest DAC approval, the Defence Ministry has given an in-principle nod to, among others, the procurement of SU-30 MKI and Advanced Light Helicopters (ALH) for the armed forces.

Impact Of DAC Deal On Defense Stocks: How Defence Sector Stocks Reacted

Major defence sector stocks of the country went up against the backdrop of the announcement of the DAC announcement.

• Bharat Dynamics Limited (BDL): Share Price: 1,204.95, a gain of Rs 52.75, up by 4.58 per cent shortly after the market opened on Wednesday
• Hindustan Aeronautics Limited (HAL):  Share Price: 4,526.15, a gain of Rs7.30, up by 0.16 per cent shortly after the market opened on Wednesday
• Cochin Shipyard Limited (CSL): Share Price: 1699, a gain of Rs 13.45, up by 0.80 per cent shortly after the market opened on Wednesday
• Garden Reach Shipbuilders & Engineers Limited (GRSE): Share Price 1770.20, a gain of Rs 65.75, up by 3.86 per cent shortly after the market opened on Wednesday
• Bharat Electronics Limited (BEL): Share Price: 313.75, a gain of Rs 1.65, up by 0.53 per cent shortly after the market opened on Wednesday

What Was The DAC Nod About?

DAC granted Acceptance of Necessity (AoN) for the procurement of 31 New Water Jet Fast Attack Crafts (NWJFACs) for the Indian Navy. These are designed to perform the task of Low-Intensity Maritime Operations, Surveillance, Patrol, and Search and Rescue (SAR) operations close to the coast. In addition, these vessels will play an effective role in Anti-Piracy missions, especially in and around our Island territories.

DAC also accorded AoN for the procurement of 120 Fast Interceptor Crafts (FIC-1). These vessels are capable of performing multiple roles, including escorting High-Value Units such as Aircraft Carriers, Destroyers, and Frigates, Submarines for coastal defence.

AoN for procurement of Electronic Warfare Suite (EWS) comprising External Airborne Self Protection Jammer pods, Next Generation Radar Warning Receiver, and associated equipment for Su-30 MKI Aircraft was accorded by DAC. This system will enhance the operational capabilities of SU-30 MKI and protect it from enemy radars and related weapon systems while carrying out a mission against enemy targets protected by Air Defence systems.

DAC accorded AoN for procurement of six Advanced Light Helicopters (ALH) M (MR) for the Indian Coast Guard to strengthen the Coastal Security and Surveillance in the coastal areas. It has also accorded approval for the overhaul of T-72 & T-90 tanks, BMP- and engines of Sukhoi fighter aircraft which will enhance the service life of these assets, PIB reported.