BEL, Paras Defence, Mazagon Dock: Here is how early birds from defence sector fared in Q1 FY26

The two biggest sectors of the economy—IT and banking—have posted subdued numbers and have flagged various concerns. The IT sector has been reeling under pressure owing to demand contraction and macroeconomic uncertainties, while the banking sector has been dealing with asset quality deterioration and rising credit costs.

In the lending business, credit costs refer to the total cost a bank incurs due to lending-related credit risks—specifically the cost of bad loans (NPAs) and provisions set aside for potential loan losses.

Besides these, companies from different pockets of the economy have also started releasing their financial numbers for the quarter gone by.

One of the sectors on the list is defence, which saw huge buying interest during the first quarter. Here is how key defence names have fared in the Q1 FY26 earnings season.

Mazagon Dock Shipbuilders

Mazagon Dock Shipbuilders, India's biggest warship builder, on Monday reported a 35% drop in its consolidated net profit for the June quarter (Q1 FY26) to ₹452.15 crore.

It had posted a net profit of ₹696 crore during the April-June quarter of the previous fiscal year, Mazagon Dock Shipbuilders said in a regulatory filing.

The company's revenue from operations increased by 11.4% year-on-year (YoY) to ₹2,625.59 crore during the quarter under review compared to ₹2,357.02 crore in the corresponding period of the previous fiscal year.

Its total expenses surged to ₹2,348.05 crore in the June quarter from ₹1,739.23 crore a year ago, with a notable increase in raw material costs, procurement of spares, subcontracting charges, and provisioning, it added.

Last month, the state-owned defence PSU Mazagon Dock Shipbuilders said it would acquire a controlling stake in Colombo Dockyard PLC in an all-cash deal of about ₹452 crore.

The Mumbai-headquartered shipbuilder said the proposed acquisition will enable the company to strengthen its position in the ship repair and shipbuilding industry by unlocking operational synergies, enhancing research and development capacities, and expanding market reach.

This is the first instance of an Indian shipyard, both state-owned and private, acquiring a shipyard overseas. Colombo Dockyard PLC is a publicly listed company incorporated under the laws of Sri Lanka.

Bharat Electronics (BEL)

Bharat Electronics Ltd (BEL), the state-run aerospace and defence electronics player, recorded a 22.61% increase in its consolidated net profit attributable to owners of the company at ₹969.91 crore in the first quarter of the financial year 2025-26 (Q1 FY26), the company said in an exchange filing on Monday, July 28.

It had posted a post-tax profit of ₹791 crore a year back.

Its revenue from operations climbed 4.62% to ₹4,439.74 crore in Q1 FY26, compared to ₹4,243.57 crore in the same period of the previous fiscal year.

BEL's earnings before interest, taxes, depreciation, and amortisation (EBITDA) stood at ₹1,238 crore in the April-June quarter of the current fiscal year, as against ₹948 crore a year. This reflects a year-on-year (YoY) increase of 30.59%.

The EBITDA margin was at 27.89% vs 22.34% a year back.

The order book of Bharat Electronics Ltd, or BEL, stood at ₹74,859 crore as of July 1, 2025.

On July 25, BEL had secured an order worth ₹1,640 crore for the Defence Ministry to supply Air Defence Fire Control Radars to the Indian Army.

Paras Defence

Paras Defence & Space Technologies, a defence equipment maker, announced its first quarterly results for FY26 on Friday, 25th July, 2025. The consolidated net profit stood at ₹14.87 crore in Q1 FY26, up 0.13% from ₹14.85 crore a year back.

The company’s revenue from operations advanced 11.51% to ₹93.19 crore as against ₹83.57 crore in the same period of the previous year. Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) dropped 8.7% from the same period last year to ₹22 crore, with margins shrinking by over 500 basis points to 23.6% from 28.8%.

The company reported a decline in revenue of 13.89% compared to the previous quarter. Total income stood at ₹95.57 crore, up 13.57% from the same period last year but down 15.77% quarter-on-quarter.

Quarterly expenses totalled ₹76.05 crore, reflecting a 17.67% increase from the year-ago period. Profit before tax was ₹19.45 crore, marginally lower than the ₹19.50 crore recorded in the same quarter last year and 27.17% lower than the previous quarter.

Zen Technologies

The company reported a PAT (profit after tax) for the June quarter (Q1 FY26) of ₹37.12 crore, down 50% from ₹74.18 crore logged in the year-ago period.

Its sales stood at ₹111.06 crore, down 56.26% from ₹253.96 crore registered in the corresponding period of the previous fiscal year.

The company's total revenue came in at ₹130.95 crore, down 49% from ₹257 seen in Q1 FY25.

EBITDA slipped from ₹106.24 in Q1 FY25 to ₹57.94 crore. EBITDA margins increased to 52.17% from 41.83% in the year-ago quarter.

Commenting on the results, Ashok Atluri – Chairman and Managing Director, said: “Our Q1FY26 results reflect moderation in topline growth, we believe this is a temporary adjustment phase with a much stronger long term growth trajectory. Despite this temporary moderation, our business fundamentals remain strong. We have successfully maintained our EBITDA and PAT margins, reflecting strong operational discipline and cost efficiency. Our consolidated order book stands at ₹754 crores and maintain a debt free balance sheet."

Looking ahead to H1FY26, "we remain confident in achieving our order inflow guidance of ₹800 crore. Out of which we have secured orders amounting to ₹150 crore till date, with the remaining ₹650 crore expected to materialise within the first half. In addition, we expect orders to be placed under the government’s emergency procurement plan, particularly for anti-drone systems," the MD added.

"Our robust pipeline, combined with continued policy support for indigenous manufacturing, positions us well for sustained growth. While FY26 is likely to be a year of consolidation, we remain focused on executing our long-term strategy and are confident in maintaining our targeted cumulative revenue of ₹6,000 crores over the next 3 financial years," the MD said further.

How defence stocks are trading today

The Nifty India Defence Index was trading 0.85% lower at 7,769.85 levels. The Nifty India Defence Index aims to track the performance of a portfolio of stocks that broadly represent the defence theme.

From the Nifty Total Market index, stocks forming part of eligible basic industries or those that obtain at least 10% of revenues from the defence industry are eligible to be included in the index and are chosen based on 6-month average free-float market capitalisation, explains NSE.

How individual stocks are performing

BEL stock was trading at ₹385.05, down 1%. Paras Defence and Space Technologies shares were trading over 3% lower at ₹682.50 apiece, while Zen Technologies was locked in the 5% lower circuit. Mazagon Dock Shipbuilders was trading over 4% lower at ₹2,674 on the NSE.