Defence stocks continue to rally

Stocks connected to defence sector continued to rally for the second day today after Prime Minister Narendra Modi’s call yesterday to the country to ramp up production within the country and reduce the dependence on import of defence products.

The one exception was Bharat Electronics which was down in the morning trade today.

Pipavav Defence and Offshore Engineering touched a new 52-week high of ₹85 before slipping to ₹79.15, a gain of ₹1.40. The stock witnessed colossal trading of 1.89 crore shares even within two hours of trading in the morning.

Bharat Forge , bolstered by a joint venture with Rafael for high tech missile systems, jumped by ₹39.25 to ₹1,264.90. This stock also touched a new yearly high of ₹1,280.50.

Another factor that worked in its favour was the announcement that it had signed a multi-year contract with Boeing to supply titanium forgings for wing components for its nextgen 737 and 737 MAX airplanes. The group company Kalyani Steels also rallied by ₹16.85 to trade at ₹152.45.

Astra Microwave and BEML were the other two defence sector stocks to reach new yearly highs. Astra Microwave touched a new high of ₹165.80 before losing some of the gains to trade at ₹159.90, a gain of ₹5.05. BEML was trading higher by ₹9.55 at ₹1,000 and it also touched a new 52 week high of ₹1,024.

Two other companies to benefit from their defence links were Mahindra & Mahindra and L&T. M&M gained ₹6 to trade at ₹1,234.20 and L&T jumped by ₹12.85 to trade at ₹1,676.20.

However, Bharat Electronics shed ₹81.45 to slip to ₹3,912.