Premium Subscribers: Complete your KYC to Avoid
Service Suspension. Login Here.

MEMBER'S LOGINX

     
Invalid Username / Password
   
     
   
     
 
Invalid Captcha
   
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Investment in securities market are subject to market risks. Read all the related documents carefully before investing

LIVE NOW
The Small Cap Proxy Players Briefing




Important: We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
By submitting your email address, you also sign up for Profit Hunter, a daily newsletter from Equitymaster
covering exciting investing ideas and opportunities in India.

AD

How to Invest in Defence Stocks

Defence stocks are strong candidates for long-term wealth creation.

The government's push for self-reliance in defence will be a massive tailwind for these stocks. Many defence companies will likely pop up over the next few years. These businesses will cater to new ideas that the market is probably not even aware of.

The biggest catalyst of Make in India initiative for the defence sector was the government scrapping some major defence procurements from abroad. The scrapped orders include big ticket purchases of helicopters, all-terrain vehicles (ATVs) and short-range missiles, among others.

The long-term prospects of this sector are bright. But picking the right stocks will be a challenge.

This is because India's defence capabilities go beyond what is visible on the stock market indices. There are unlisted firms and niche hi-tech startups paving their way to become global defence suppliers.

As an investor, it's vital to understand the entire defence ecosystem in India if you want to pick the best stocks in this space.

Also, if the past has taught us anything, it's that you must have a long-term view and not get caught up in short term trends.

So how can you find the best defence stocks?

Here's a checklist...

  • A healthy, multi-year order book
  • High profile defence contracts (aircrafts, tanks missiles, submarines, drones)
  • Strong financials (low debt to equity ratio, strong cash flows, high ROE)
  • Solid backing by the promoters (in case of a private sector firm)
  • A track record of profitability

And last but not least, check the stock's valuations. Check both the price to book ratio and the price to earnings ratio. They shouldn't be too high.

You can get started with Equitymaster's screener for defence stocks. Also check out the list of defence stocks in the market.

Stocks in the defence space can offer good investment returns if you pick them carefully.


5 Defence Stocks to Watch if the Iran War Drags on

Mar 23, 2026

If history is any guide, prolonged conflicts don't just increase uncertainty, they accelerate military spending. Here are 5 companies to watch...

Global Conflicts Heating Up: 3 Defence Mutual Funds to Add to Your Watchlist

Mar 9, 2026

These three mutual funds hold defence companies involved in the domestic manufacturing push in the sector.

3 Tiny Defence Penny Stocks with Massive Potential

Mar 7, 2026

These lesser-known companies from the defence space could benefit big time from India's defence spending.

3 Drone Exporting Stocks for 2026 and Beyond

Mar 4, 2026

The best opportunities exist in uncertain times, and these 3 companies make a compelling story in the drone exporting ecosystem.

US-Israel-Iran War: 5 Stocks Across Sectors to Watch as Geopolitical Risks Rise

Mar 2, 2026

From defence to gold, stocks watch amid global tensions.

5 Defence Stocks to Watch as India-Israel Defence Ties Strengthen

Feb 20, 2026

Given past defence ties with Israel, these are five defence names to watch.

5 Smallcap Drone Stocks to Add to Your 2026 Watchlist

Feb 16, 2026

These smaller drone companies deserve your attention. Take a look.

This Stock Went Up 30x in 3 Years. How Can You Find the Next One?

Feb 5, 2026

Here's what investors can learn from the stock of Mazagon Dock.

3 Best Defence Stocks to Add to Your Watchlist

Jan 29, 2026

Here are a list of 3 defence stocks that can be added to your watchlist.

Defence Stocks to Watch Despite the Union Budget

Jan 28, 2026

Vulnerability of the stocks to defence outlay uncertainties can impact valuations.

Which Sectors Could Outperform This Year?

Mar 11, 2026

These are the sectors to watch in 2026.

5 Anti-Drone Stocks to Watch as Drone Warfare Reshapes Modern Conflict

Mar 9, 2026

Drone warfare is rapidly changing the rules of modern conflict. As militaries race to build counter-UAV capabilities, a handful of Indian defence companies are emerging at the centre of this shift.

12 Indian Defence Stocks to Watch Amid the War in the Middle East

Mar 4, 2026

Which defence stocks should you be tracking? Read on...

Missiles, Jets, and Now Drones: 3 Stocks Riding the Defence Shift

Mar 4, 2026

Defence stocks are in the limelight once again, due to geo-political tensions. Here are a few missiles, jets, and drone stocks to watch.

Best Defence Stocks to Watch in 2026 and How to Invest in Them

Feb 28, 2026

With growing demand, here's a look at India's notable defence stocks in 2026.

4 Aerospace and Defence Stocks to Watch Amid India-France Strategic Push

Feb 18, 2026

As the India-France strategic cooperation gains momentum, here are four aerospace and defence stocks to watch.

5 Beaten Down Defence Stocks to Watch

Feb 7, 2026

What's the outlook for defence stocks? Find out...

Why Bharat Dynamics Share Price is Falling

Feb 2, 2026

Bharat Dynamics shares fell for the second consecutive session, sliding nearly 7% intraday. Here's why.

Why GRSE Share Price is Rising

Jan 29, 2026

GRSE Shares jumps over 4% intraday. What's fuelling the rally?

3 Defence Stocks Bought by FIIs in December 2025 Quarter

Jan 26, 2026

Here are a list of 3 defence stocks bought by FIIs in December 2025 quarter.