India-Pak tensions: Chinese J-17 fighter jet maker's stock rallies 36% in 2 days

Shares of Avic Chengdu Aircraft Co Ltd rallied over 36 per cent in two sessions in Shenzhen trading amid flaring up of tensions between India and Pakistan. The Chinese defence company is the manufacturer of J-17 and J-10C fighter aircrafts. Pakistan Airforce is said to be operating J-10 Vigorous Dragon and JF-17 Thunder. 

Data showed Avic Chengdu Aircraft climbed 16.37 per cent to hit a high of 80.68 yuan on Thursday. This was in addition to a 17 per cent rally on the counter on Wednesday. With this, stock has climbed 36.21 per cent in two days and 44 per cent in the past one month. 

There were unconfirmed reports, many debunked by fact checkers, of Pakistan shooting down of Indian fighter jets that were in action in the Operation Sindoor. The Indian Embassy, in response to an article by the Chinese state-run Global Times, cautioned the media outlet over spreading unverified claims on Indian military operations. 

On May 7, India launched Operation Sindoor on nine terror targets in Pakistan and Pakistan-occupied Kashmir. A Pakistani foreign ministry release later confirmed strikes in Bahawalpur, Kotli, Muzaffarabad and Muridke. Gulpur, Bhimber, Bagh, Chak Amru and Sialkot were some additional sites reportedly hit by Indian missiles. 

The missile attack was the first such move since the 1971 war when India’s Army, Navy, and Air Force launched joint precision strikes on nine terror hubs in Pakistan and PoK. 

Following the Operation Sindoor, Pakistan's Karachi 100 index plunged 3,559.48 points or 3.13 per cent to settle at 1,10,009.03 on Wednesday. Domestic benchmark indices Sensex and Nifty, on the other hand, were calm and ended the day higher. 

Emkay Global said while India’s strong response to the Pahalgam terror attacks has raised the specter of escalated conflict with Pakistan but ]it is unlikely to affect markets. It, however, acknowledged that this is an unpredictable situation and that it would re-calibrate its market views if developments trigger a change in the base case assumption. 

"Our bull thesis of a beta rally in India is based on monetary easing, resilient earnings, and supportive valuations. The 8.9 per cent jump in the Nifty since April 9 has taken away some valuation comfort, though we are not in frothy territory yet. Markets could consolidate in the short term, but we still see ~7% upside to the Nifty in FY26, with SMIDs outperforming," Emkay Global said.

"While short-term caution is reasonable, history shows that Indian markets demonstrate strong resilience once clarity returns. Unless accompanied by broader economic or global shocks, Indo-Pak tensions have not had a lasting negative impact. Investors should focus on fundamentals, not fear." said Pankaj Singh, Founder at SmartWealth.ai.