56 times growth in exports! Defence sector stocks are in focus; here's why

Shares of defence sector firms such as Hindustan Aeronautics, Bharat Electronics, Mazagon Dock Shipbuilders, Bharat Dynamics, Cochin Shipyard, Garden Reach Shipbuilders & Engineers (GRSE), BEML, Solar Industries India Data Patterns (India), Zen Technologies, Paras Defence and Space Technologies, MTAR Technologies, Astra Microwave Products among others are in focus after the government said India's defence production reached a record Rs 1.78 lakh crore in 2025–26.

Data released by the Ministry of Defence showed that defence output increased 15.6% year-on-year, compared with Rs 1.54 lakh crore in FY25. The sector has also recorded substantial growth over the past five years, with production more than doubling from Rs 84,643 crore in FY21, representing an increase of about 110%.

The expansion becomes even more significant when compared with FY14, when India’s defence production stood at Rs 43,746 crore. Output has since increased nearly fourfold, reflecting the expansion of domestic manufacturing capacity and a stronger focus on indigenous defence procurement.

Rajnath Singh Applauds Growth in Indigenous Manufacturing

Defence Minister Rajnath Singh welcomed the record production figures and attributed the sector’s rapid progress to the leadership of Prime Minister Narendra Modi and the government’s focus on strengthening domestic defence capabilities.

In a post on X, Singh said the record performance demonstrated the progress made towards building a stronger indigenous defence manufacturing ecosystem. The government has increasingly focused on domestic production as part of its **Aatmanirbhar Bharat** initiative, with the objective of reducing dependence on imported defence equipment while expanding India’s capabilities across the defence supply chain.

76% of the production was from public-sector entities and 24% from the private sector.

The government said the country clocked 56-times growth in defence exports from Rs 686 crore in FY2013–14 to Rs 38,424 crore in FY2025–26.

Exports have reached reaching 80 plus countries and increased to over 5,500% in twelve years. Private sector contributed Rs 17,353 crore or 45.16% of defence exports in FY2025–26, while defence public sector undertakings contributed Rs 21,071 crore or 54.84%.

The government said it is targeting Rs 3 lakh crore in annual defence production and Rs 50,000 crore in exports by 2029.