Defence Stocks: Top 5 Multibagger PSU Shares Trending; Do You Own Any?

Defence Public Sector Undertakings (PSUs) have been experiencing significant gains, with a notable rise in stock prices. Hindustan Aeronautics Limited (HAL), Bharat Electronics Limited (BEL), Bharat Dynamics Limited (BDL), Cochin Shipyard Limited (CSL), and Mazagon Dock Shipbuilders Limited (MDL) are among the leading defence stocks that have shown substantial growth. The surge is attributed to the Government of India's push for self-reliance in defence manufacturing and increased exports to friendly foreign countries (FFCs).

Hindustan Aeronautics Limited (HAL)

HAL, India's largest defence PSU, has shown remarkable performance. The company designs, manufactures, repairs, overhauls, and upgrades various aerospace products, including aircraft and helicopters. HAL's order book stands at an impressive Rs 94,000 crore as of March 31, 2024, reflecting a strong outlook for the upcoming fiscal year.

Recently, HAL shares reached a new 52-week high of Rs 4,744.80, gaining 5% in a single day of trading on the BSE. Over the past week, HAL's shares have risen by 22.12%, driven by a substantial 52% year-on-year increase in consolidated net profit, amounting to Rs 4,308.68 crore for the March quarter. Over the past year, HAL's stock has delivered a return of 205.70%, and an astounding 463.01% over the last five years, showcasing its robust growth trajectory.

Bharat Electronics Limited (BEL)

BEL, a prominent aerospace and military electronics manufacturer, is another top performer. As one of the sixteen PSUs under the Ministry of Defence, BEL enjoys Navratna status. The company's order book as of April 1, 2024, is approximately Rs 76,000 crore. BEL also reported a significant increase in export sales, achieving US$92.98 million in FY 2023-24, nearly double the previous year's export turnover.

BEL shares rose by 6% in intra-day trading on the BSE. Over the last week, the shares have climbed by 14.01%. BEL has provided a return of 140.46% in the past year and 233.74% over two years. Over three and five years, the stock has returned 402.82% and 747.58%, respectively. BEL's shares have traded between a 52-week high of Rs 260.60 and a low of Rs 105.75, with a market capitalization of Rs 1,89,213.62 lakh crore as of May 19.

Bharat Dynamics Limited (BDL)

BDL, a manufacturer of ammunition and missile systems, holds Mini Ratna status. The company reported a turnover of Rs 2,350 crore for the fiscal year ending March 2024, slightly down from the previous year. However, BDL boasts an order book worth Rs 19,468 crore for FY2024.

In the last week, BDL shares have surged by 30.97%. The stock has yielded a return of 127.17% over the past year and 240.70% over two years. In three and five years, BDL's stock has delivered impressive returns of 608.34% and 820.68%, respectively.

Cochin Shipyard Limited (CSL)

CSL operates India's largest shipbuilding and repair facility and constructed the INS Vikrant, the first indigenous aircraft carrier for the Indian Navy. CSL holds Miniratna status.

CSL shares rose by 5% in intra-day trading, reaching a new 52-week high on May 18. Over the past week, CSL's stock increased by 20.62%. The stock has provided a return of 442.62% in one year, 805.97% in two years, 669.49% in three years, and 719.64% in five years. CSL's market capitalization stood at Rs 39,035.93 crore as of May 19.

Mazagon Dock Shipbuilders Limited (MDL)

MDL, controlled by the Ministry of Defence, specialises in constructing warships and submarines for the Indian Navy. The company is 84.83% owned by the Government of India.

MDL shares rose by 5% in a special trading session on May 18, reaching a new 52-week high. Over the past week, MDL shares have surged by 30.83%. The stock has returned 267.80% in one year, 899.03% in two years, and 1297.28% in three years. MDL's market capitalization was Rs 57,969.74 crore as of May 19.

Stocks:

The significant gains in these defence stocks highlight the sector's robust growth potential, fueled by government initiatives and increasing exports. Investors looking for long-term growth prospects may find these PSUs attractive as they continue to expand and contribute to India's defence capabilities.

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