Stocks to Buy: Incredes Bully, Bel Shares; Sees up to 26% upside in these defince stocks

The recent education of geopolitical tensions in the middle East amid the israel -ran war, and the India-pakistan conflict last month has Renewed Investors’ Focus on Defense Stocks. India’s Defense Sector Growth over the Past Decade Has Been Driven Primarily by Government Budgets and Policies that Promote Domestic Production.

The ministry of defense’s budget has roughly doubled, from 2.7 Lakh Crore in 2015–16 to 6.8 Lakh Crore in 2025-26, The Highest Among ALL Ministry, Accounting for 13% of the Central Government’s Total Expenditure. Defense Exports Rose by 13X Since FY16, Private Sector Exports Rose by 67X and Domestic Procurement Share Srigreed to 75%, with large bring headroom for Growth.

Analysts believe that the geopolitical tensions with China and Pakistan are expected to increase government speeding in the coming years.

The government’s ‘make in India’ Initiative and Policies Like the Defense Acquisition Procedure 2020 prioritize Domestic Procurement, with Approximately 75% of the Modernization Budget allocated to Local Indians.

According to increase rights, this focus has positioned defense psus as the backbone of India’s defense manufacturing ecosystem, priorrything from aircraft and electrics to naval vessels and Weaponry.

Among the defense psus, hindustan aeronautics (hal) and bharat electronics (bel) stand out as the leading contributors, collectively accounting for ~ 50% of the Total Products by Defections PSUPANIS Increded equities said.

HAL, A Navratna Company, Contributes ~ 27% of the production, specializing in Fighter Aircraft, Helicopters, and Avionics, Including The Indigenous Light Combat Aircraft TEJAS and Advanced Light Helicopter Dhruv.

Bel, with a ~ 21% share, focuses on advanced electronics

Increded Equites have Initiated Coverage on Hal and Bel Shares with a Bully a bullish outlook. Here are the defense stock picks by the brokerage firm:

Hal | Add | Target price: 6,325

Hindustan Aeronautics’ Strong Order Book, Coupled With Ongoing Indigenization and Modernization Initiatives, Underpins a Stable Growth Trajectory – EPS is Forecast to Rise by 16% yoy in fy26f and 18% yoy in fy. FY27F, Incred Equites Said.

The Brokerage Firm Initiates Coverage on Hal Shares With A, ‘Add’ Rating and Target Price of 6,325, based on a 40 × p/e on mar fy27f estimates. Hal share price target implies an upside potential of up to 26% from monday’s closing price.

BEL | Add | Target price: 459

Bharat Electricals ‘Robust Order Book, Coupled With Expected Orders’ Long-Term Visibility, Provides Strong Revenue and Growth Confidence. The success of operation sindoor enhances its global standing and expense potential. Aided by the government’s push for indigenization, and a Trusted Partnership With the Ministry of Defense, Bel is Well-Positioned as a key beneficiary in the definition

IT Initiated Coverage with an ‘Add’ Rating. It has belt share price target of 459, based on a 44 × p/e applied to forecasted fy27F EPS of 10.4.

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