Russo-Ukraine War: After the Russian military invasion of Ukraine, global defense expenditure is expected to increase sharply. According to stock market experts, due to this Ukraine-Russia war, there is a possibility of some tension in the sea of China, especially around Taiwan. Hence, market experts are expecting the defense stocks to perform well in the global markets. In the Indian secondary market too, analysts are quite bullish on the defense sector stocks. He said positional investors in the Indian stock market can buy defense stocks like Bharat Dynamics, Bharat Forge, Bharat Electronics, Hindustan Aeronautical Limited and L&T.
Speaking on the reasons for the rally on defense stocks after the outbreak of Russo-Ukraine War; Saurabh Jain, assistant vice president of research at SMC Global Securities, said, “Following the outbreak of the Ukraine-Russia war, the possibility is high that post-war global defense expenditure may be higher. Recently, Germany has increased its defense expenditure and others. The hike has been announced. The shoots from EU countries are expected to follow.”
This geopolitical tension is expected to further heat up the Taiwan issue; Anuj Gupta, Vice President, IIFL Securities said, “The Russia-Ukraine crisis is expected to lead to Taiwan-China conflict and therefore lead to a steep increase in global spending on defense. This is also going to impact Indian defense expenditure and hence The Indian government will do so. There is no option but to increase its defense expenditure as well.”
asked about defense stocks to buy today; Saurabh Jain of SMC Global said, “One should look at defense stocks that have a long history of catering to the sector and have a strong face value in the market. From this perspective, I would bet on Bharat Dynamics, Bharat Forge, India Will buy shares of Electronics, Hindustan Aeronautical Limited and L&T today.”
If one has limited amount for investment; Anuj Gupta of IIFL Securities said, “Out of these 5 defense stocks – Bharat Electronics, HAL and Bharat Dynamics are ranked better on the chart pattern and they can give higher yields than the other two defense stocks. No one should buy Bharat Electronics Can buy for medium term target on CMP. maintain stop loss at 280 185 levels. Those looking to buy HAL shares can buy momentum on CMP for medium term target maintain stop loss at 1800 1180. Similarly, Bharat Dynamics shares can be bought on CMP for medium term target maintain stop loss at 580 380 each level.”
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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