Bharat Dynamics, Mazagon Dock, HAL: Defence stocks trade higher ahead of Defence Acquisition Council meeting; check key agenda

The meeting will be headed by Defence Minister Rajnath Singh.

Key agenda items include overhauling four regiments of T-90 tanks, enhancing the Navy's capabilities with ten new tugs and SDR software radios, and acquiring seven fuel mission simulators for the Air Force, as per news reports.

At the time of writing this news, Mazagon Dock Shipbuilders was trading 2.58% higher at ₹2,605.90, while Hindustan Aeronautics (HAL) was up 1% at ₹4,465.20. Bharat Dynamics shares were up 2% at ₹1,512.80, while Bharat Electronics shares were up around 1.5% at ₹405 on the NSE.

The Nifty India Defence Index was trading over 1.2% at 7,887.60 levels.

The Nifty India Defence Index aims to track the performance of portfolio of stocks that broadly represent the Defence theme. From the Nifty Total Market index, stocks forming part of eligible basic industries or those which 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.

"The weight of the stocks in the index is based on their free-float market capitalisation. Stock weights are capped at 20%," the NSE explains.

Defence sector in India: What you need to know

In September 2025, a top government official said that the government has been serious in promoting the defence production industry in the country through the private sector and is open to incorporating its meaningful suggestions on the policy and procedures.

Addressing a session virtually at the ICC Global Summit 2025, Defence Production Secretary Sanjeev Kumar also said that the primary objective of self-reliance is to make the country independent of foreign agencies in sustaining a war.

"The government has been very serious in promoting defence production industries in this country through the private sector and will continue to do so. We are open to all meaningful suggestions to be incorporated in our policies and procedures so that participation of the private sector becomes more efficient and meaningful," Kumar said.

Defence manufacturing in India

According to the India Brand Equity Foundation (IBEF), India is home to one of the strongest military forces in the world and holds a position of significant strategic importance. The Indian defence sector comprises several key market segments, with military fixed-wing aircraft, naval vessels and surface combatants, and missiles and missile defence systems representing the top three.

The defence manufacturing industry plays a vital role in India’s economy and is poised for accelerated growth, driven by rising national security concerns.

India’s defence exports have surged dramatically, rising from ₹686 crore (US$ 81.1 million) in FY14 to ₹23,622 crore (US$ 2.76 billion) in FY25.

Private sector players contributed ₹15,233 crore (US$ 1.80 billion), while Defence Public Sector Undertakings (DPSUs) accounted for ₹8,389 crore (US$ 992.2 million).

Defence exports recorded a 12% YoY increase in FY25, and in FY26 (April-September 2025), exports have already reached ₹9,131 crore (US$ 1.07 billion), underscoring India’s growing presence in the global defence market.

Union Budget FY26

• In FY26, the Ministry of Defence (MoD) was allocated a total budget of ₹6.81 lakh crore (US$78.7 billion), which is a 9.5% YoY increase from the FY25 budget.

• Of this, ₹1.80 lakh crore (US$ 20.8 billion) was allocated towards capital expenditure, including the purchase of new weapons, aircraft, warships, and other military equipment.

• An outlay of ₹7,146 crore (US$ 825.7 million) was announced towards the capital expenditures of the Border Roads Organization (BRO).