3 Rare Earth Magnet Stocks to Watch After Budget 2026 Policy Push

#1 GMDC

First on the list is GMDC.

The company is steadily expanding beyond its core lignite operations, with plans to foray into coal mining in Odisha and scale up its presence in critical minerals such as copper and rare earth elements.

As a part of this GMDC is developing one of the world's leading rare earth processing hubs in India. The proposed hub is designed to integrate the entire REE value chain and support downstream industries such as metals and alloys, permanent magnets, electric motors, glass and optical glass manufacturing.

According to FY25 annual report, GMDC has also been nominated by the Department of Atomic Energy, Government of India, as a prospective lessee for mining REEs and associated minerals at Ambadungar in Gujarat's Chhota Udepur district, which is among the world's largest rare earth deposits. The company is currently in the process of preparing and securing approvals for its mining plan.

Its rare earth portfolio includes :

Neodymium and Praseodymium, critical for permanent magnets used in electric vehicles and wind turbines.

Lanthanum, used in petroleum refining catalysts and hybrid vehicle batteries.

Cerium, which finds applications in automotive catalytic converters and glass polishing.

The rare earth concentrate from Ambadungar is planned to be processed at the upcoming REE hub in Bharuch, where oxides will be converted into metals for manufacturing catalysts and rare earth magnets.

Against the backdrop of the Union Budget 2026's strong push towards rare earth magnets and domestic value addition, GMDC emerges as one of the key stocks to watch in this space.

On the financial front, over the past five years the company's revenue has seen a growth of 15.7%.

The company's five-year average ROE and ROCE stand at 10.1% and 12.6%.

GMDC's Financial Snapshot

For more details, see the GMDC company fact sheet and quarterly results.

#2 Hindustan Zinc

Next on the list is Hindustan Zinc.

Hindustan Zinc is a leader in the critical minerals and energy transition space, backed by scale, cost leadership, strong market share, and a solid financial foundation.

The company is the world's largest integrated zinc producer and ranks among the top five silver producers globally, making it India's only listed integrated precious metals company.

Hindustan Zinc has strengthened its presence in the critical minerals space by securing a tungsten block in Andhra Pradesh, followed by the acquisition of two additional critical mineral blocks in May 2025, including a potash block in Rajasthan and a rare earth elements block in Uttar Pradesh.

Speaking at the company's 59th Annual General Meeting, Chairperson Priya Agarwal Hebbar said that HZL is actively exploring opportunities in rare earths and other critical minerals, while also evaluating partnerships with global players to deploy advanced technologies such as AI- and drone-based exploration.

She further highlighted that the company is likely the first private company in India to secure a rare earth monzonite block, a land-based and non-radioactive deposit, distinct from the beach-sand monazite currently mined by Indian Rare Earths Ltd. Given that monazite is a key source of neodymium used in rare earth magnets, it makes HZL a key stock to watch amid this.

On the financial front, over the past five years the company's revenue has seen a growth of 12.9%, meanwhile, net profit grew at a CAGR of 8.8%.

The company's five-year average ROE and ROCE stand at 52.6% and 62.3%.

Hindustan Zinc's Financial Snapshot

For more details, see the HINDUSTAN ZINC company fact sheet and quarterly results.

#3 Sona BLW Precision Forgings

Last on the list is Sona Comstar.

Gurgaon-based Sona Comstar, officially known as Sona BLW Precision Forgings was the first company in India to announce plans to make magnets domestically after the government's program became public.

Sona Comstar CEO Vivek Vikram Singh told Reuters in an interview that, as the country's largest importer of rare earth magnets, the company is among the most affected by recent supply disruptions and is therefore focused on supporting India's self-sufficiency in magnets while working closely with the government on this initiative.

The company, which supplies gears and motors to car makers such as Tesla and Stellantis, imported 120 metric tonnes of magnets from China in the last financial year.

Sona BLW Precision will look at the Indian incentives once they are finalised, and other factors, to determine its investment in the local manufacturing. The company has the funds for local manufacturing, citing its five-fold increase in revenue to more than US$ 400 million over the past five years.

On the financial front, over the past five years the company's revenue has seen a growth of 27.9%, meanwhile, net profit grew at a CAGR of 10.7%.

The company's five-year average ROE and ROCE stand at 16.4% and 21.5%.

Sona BLW Precision Forgings' Financial Snapshot

For more details, see the SONA COMSTAR company fact sheet and quarterly results.

Conclusion

With demand for rare earth permanent magnets expected to surge sharply over the coming years, driven by electric mobility, renewable energy, electronics and defence, companies operating in this space are set to gain from stronger policy support and rising domestic consumption.

However, investors should also be mindful of the risks.

The sector remains capital-intensive, project execution timelines can be long, and outcomes are closely linked to policy clarity, technology access and global pricing dynamics of rare earth elements. Regulatory approvals, environmental clearances and dependence on global partnerships could also impact near-term visibility.

Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions.

Happy investing.

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