Defence Stocks: The stock market has been up and down this year, but one sector has been flying high defense. Over the last three months, defense stocks have jumped between 40% to 90%, while the Nifty-50 only grew by 5%. The Nifty Defense Index alone has given investors a huge 30% return in 2025. Because of this, defense stocks are now the hot topic among traders and investors.
Brokerage firm ICICI Direct has picked four defense stocks that they believe will keep rising. They say the recent tensions between India and Pakistan have pushed the government to spend an extra ₹40,000 crore on emergency defense purchases. The Defense Secretary also wants India’s defense budget to go up from 1.9% of GDP to 2.5% by 2029-30. On top of that, capital spending (Capex) should increase from 0.5% to 0.8% of GDP in the same period. ICICI Direct estimates this could mean ₹7-8 lakh crore worth of defense orders in the next five years.
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Hindustan Aeronautics (HAL)
ICICI Direct says HAL is a strong buy with a target price of ₹6,100. Right now, the stock is at ₹4,987, which means it could go up by 22%. HAL makes fighter jets and helicopters, and with more government spending, the company is likely to get big orders.
Bharat Electronics (BEL)
The brokerage also recommends buying Bharat Electronics (BEL) with a target of ₹430. BEL shares closed at ₹390 last Friday, so there’s a possible 10% upside. BEL makes radars, missiles, and other defense electronics, and with higher budgets, business is expected to grow.
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Midhani
ICICI Direct has added Midhani (Mishra Dhatu Nigam) to its top picks. They set a target price of ₹530, which is 25% higher than its last closing price of ₹425. Midhani produces special metals used in fighter jets and rockets, and with more defense projects coming, demand for its products will rise.
Astra Microwave
The fourth stock on ICICI Direct’s list is Astra Microwave, with a target of ₹1,270. The stock last traded at ₹1,132.55, meaning a 12% upside is possible. The company makes parts for missiles and communication systems, and with India boosting defense production, Astra is set to benefit.
