HAL, BEL, Mazagon Dock, Zen Tech, PTC Industries: Target prices for 5 defence stocks

At the Antique Defence & Aerospace Conference 4.0 – Phase II, the Honorable Additional Secretary (ASD), Ministry of Defence (MoD), highlighted priority areas including quicker contract finalisation, expedited field testing of private sector products, measures to boost defence exports, and the creation of sectoral defence champions. 

The government aims to make India a leading global defence OEM by 2047, with manufacturing capabilities on par with global standards. Efforts are underway to make acquisition and procurement processes more agile and transparent. The revised Defence Procurement Manual (DPM) was approved in September 2025, and the Defence Acquisition Procedure (DAP) revision is expected by December 2025.

Following the conference, Antique Stock Broking highlighted its preferred defence picks: Hindustan Aeronautics (HAL), Bharat Electronics (BEL), Mazagon Dock and Shipbuilders, Zen Technologies, and PTC Industries.

Hindustan Aeronautics | Rating: Buy | Target: Rs 6,360

India’s armed forces are modernising due to obsolescence and geopolitical pressures, with orders worth Rs 2 lakh crore expected by 2030. The IAF plans to expand from 31 to 42 squadrons, offering HAL an opportunity to produce 300+ aircraft including Tejas Mk-1A, Tejas Mk II, and AMCA (5th Gen) over the next 10–15 years.

Supply chain issues are easing as GE delivers engines for Tejas Mk-IA. HAL is scaling production to 24 aircraft per year and may see additional orders for 97 more Tejas Mk-1A. HAL also signed an MoU with GE to manufacture F414 engines in India, gaining 80 per cent technology transfer, potentially reaching 100 per cent over a decade. A JV with Safran will co-develop turboshaft engines for helicopters.

Antique suggested a target price of Rs 6,360, valuing HAL at 40 times H1FY28E EPS.

Bharat Electronics | Rating: Buy | Target: Rs 454

BEL is a leader in defence electronics and system integration, especially in missile systems like QRSAM (Rs 30,000 crore order expected Q4FY26). Total FY26 order inflow could exceed Rs 57,000 crore, ensuring strong revenue visibility. BEL plans annual capex of Rs 700–800 crore for facility modernisation and capacity expansion, including electro-optical, electronic warfare, and RF seeker facilities.

Mazagon Dock and Shipbuilders | Rating: Buy | Target: Rs 3,856

Mazagon Dock specialises in complex vessels and submarines. Contract negotiations are underway for Submarine Project P-75(I) (six submarines), with additional Scorpene orders possible. Total potential orders could reach Rs 1–1.05 lakh crore, more than three times the current order book. Elevated provisioning from past orders is expected to taper, supporting Ebitda recovery.

PTC Industries | Rating: Buy | Target: Rs 19,016

PTC, via Aerolloys Technologies, is building a mega Strategic Material Technology Complex in Lucknow, one of the world’s largest integrated titanium recycling and remelting facilities. At full capacity, consolidated revenue could grow 10–20 times in 5–6 years (Rs 3,500–7,000 crore by FY30), with Ebitda margins exceeding 50 per cent in the casting segment.

Zen Technologies | Rating: Buy | Target price: Rs 1,866

Zen Tech is an early mover in Anti-Drone Systems (ADS) and simulation-based military training. The ADS market in India is expected to be Rs 10,000 crore over the next five years. While near-term earnings may face temporary pauses due to order delays in FY26E, strong opportunities in ADS and simulation sectors point to a rebound from FY27E.