Shares of defence companies like HAL, Garden Reach Shipbuilders & Engineers (GRSE), and Mazagon Dock Shipbuilders saw a significant rise in Tuesday’s trading session on the BSE. The surge, which reached up to 8%, came ahead of a key meeting by the defence ministry to discuss upcoming projects.
Mazagon Dock Shipbuilders and GRSE stocks climbed by up to 8%, reaching their day’s highs of ₹4,560 and ₹1,940.75, respectively. HAL shares also gained 5%, closing at ₹4,925. The rally in HAL was further boosted by the Cabinet Committee on Security’s decision to approve the purchase of 240 AL-31 FP aero-engines from the company.
In addition, shares of Bharat Dynamics went up by 4%, closing at ₹1,356.
The upcoming defence ministry meeting will cover several major projects, including the construction of seven advanced frigates for the Indian Navy and the replacement of the Indian Army’s T-72 tanks with modern Future Ready Combat Vehicles (FRCVs).
The Indian Navy’s plan under Project 17 Bravo involves acquiring seven new warships, which will be the most advanced stealth frigates ever built in India, following the Nilgiri-class frigates currently under construction.
Defence sources suggest that the Defence Acquisition Council (DAC) is expected to approve a tender worth around ₹70,000 crore. This tender will be part of the ‘Make in India’ initiative and will be offered to Indian shipyards, including private sector ones. It is expected that the tender will be divided between two shipyards to avoid delays.
Currently, Mazagon Dock Shipbuilders and GRSE are working on Project 17A (Nilgiri-class), with MDL building four frigates and GRSE building three.
The Indian Army’s plan to replace its Russian-origin T-72 tanks with 1,700 indigenous FRCVs will also be discussed in the meeting. The tanks will be built under the Make-1 procedure of the Defence Acquisition Procedure, with Indian vendors required to ensure over 60% indigenous content. Major companies like Bharat Forge and Larsen & Toubro are likely to participate in the tender.
The Army plans to complete the FRCV project in phases, with about 600 tanks being built in each phase. The Army may also propose acquiring around 100 BMP-2 infantry combat vehicles during the meeting. The FRCV project is expected to cost over ₹50,000 crore and aims to modernise the Army’s Armoured Regiments.
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