Bharat Dynamics share price jumps 8%; experts see EU’s defence ramp-up angle

Bharat Dynamics share price has been strong bullish momentum for the last few days. Rising for the fifth consecutive session, Bharat Dynamics shares surged nearly 8 per cent in intraday trade on BSE on Friday, March 7. The defence stock opened at ₹1,060 against its previous close of ₹1,064.65 and jumped as much as 7.83 per cent to the level of ₹1,148. Around 12:05 PM, the stock traded 6.51 per cent higher at ₹1,134.

EU’s defence ramp-up a positive for Indian defence stocks

Experts at brokerage firm Elara Capital believe the European Union's (EU) rearmament plan for the EU is positive for Indian defence companies.

Elara underscored that after the US suspended military aid to Ukraine, the EU announced a five-year plan to bolster its defence industry and increase military capabilities.

In a report on March 6, the brokerage firm highlighted that the "European Union announced a rearmament plan for the EU of EUR 800 billion (nearly $850 billion) including support of Ukraine after the US suspended military aid to that country. The EU expects its member nations to raise their defence spend by 1.5 per cent of GDP, which could result in EUR 650bn cumulatively for the next four years."

"We believe defence companies in India stand to benefit as the EU defence original equipment manufacturers (OEM) turn to public and private defence firms to procure components and subsystems. Bharat Dynamic is among the potential beneficiaries," said Elara Capital.

Elara said that in addition to Bharat Dynamics, potential beneficiaries of the EU's focus on defence include Bharat Electronics, Hindustan Aeronautics, Data Patterns, Zen Technologies, Paras Defence, Solar Industries, Azad Engineering, and Dynamatic Technologies.

Bharat Dynamics share price trend

As of March 6 close, Bharat Dynamics share price has jumped over 9 per cent. It hit a 52-week high of ₹1,794.70 on July 5 after hitting a 52-week low of ₹776.08 on March 14 last year.

In the last five sessions of gains, including today, the stock has surged 18 per cent.

On the monthly scale, the stock has jumped 16 per cent in March after a 25 per cent loss in February.

Read all market-related news here

Read more stories by Nishant Kumar

Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.