Stock Market: Defence scrip turns top mutual fund attraction
By S Jha
New Delhi, February 18: Prime Minister Narendra Modi reiterated the government’s commitment to attain $5 billion of exports in defence goods by 2025 during Aero India in Bengaluru. At the same time, he also asserted that the government will stay bullish in domestic procurement of defence goods. The government is laying a lot of stress in the participation of the private enterprises in the manufacturing of the defence goods.
The necessity for indigenous defence goods productions is clearly stated by the government. Russia-Ukraine War has shown that India can no more remain dependent on the Russian defence goods. Ukraine with technological superior weapons has been able to turn the table against Russia. This has not gone unnoticed in India. That too in the context of growing Russia-China relations, which are stated to have security implications as well.
In this context, Indian Air Force has also invited the private enterprises in a bullish way to join the efforts to provide the technologically superior know-hows and weaponry. There is a buzz that the next five years may see an accelerated growth in the domestic defence manufacturing. This may also gain a boost since India is aiming to export defence goods to over 35 countries, with East Asia, Central Asia and Africa being the top emerging markets.
The Chennai-based defence company had recently listed on the bourses and since then has gained handsomely. From the level of Rs 700-800, the scrip recently scaled Rs 1500 level. The company delivered an astonishingly superior third quarter result after which it has not looked back. From the level of Rs 1050, it went past Rs 1500 just on the back of the third quarter result which showed that the company expanded revenue and profit.
Now, the mutual fund houses are making beeline to gauge the profile, fundamentals and the road ahead of the company. The company is meeting the officials of the mutual fund houses and insurance companies from February 17 to February 23. The likes of Tata Capital, Birla MF, HDFC Life, Max Life are meeting the management of Data Patterns.
The Chennai-based start up, which has been growing fast, is seen in satellite, radar, electronic defence equipment manufacturing. It has attracted the attention of even foreign fund houses such as Wells Capital and Neuberger Berman, who will be meeting the top management of the company.
(There is no suggestion of buy or sell recommendation here; investors must consult SEBI registered financial advisors before making any investment decision)
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