Defense stocks HAL, Cochin Shipyard, GRSE get boosted up to 4% after DAC approval

Shares of defense stocks, such as Bharat Dynamics Ltd., Hindustan Aeronautics Ltd., and various shipbuilding companies, opened with gains of up to 4% on Wednesday, December 4. On Tuesday, this positive movement followed the Defense Acquisition Council (DAC) 's approval of five capital acquisition proposals worth Rs 21,772 crore. 

The DAC authorized the procurement of several key assets, including Water Jet Fast Attack Crafts, Fast Interceptor Crafts, an Electronic Warfare Suite (EWS), a Next Generation Radar Warning Receiver, and Advanced Light Helicopters for enhanced surveillance in coastal areas. Specifically, the DAC approved the acquisition of 31 new Water Jet Fast Attack Crafts for the Indian Navy, which will effectively support anti-piracy missions around island territories.

Additionally, the DAC approved the procurement of six Advanced Light Helicopters for the Indian Coast Guard to bolster coastal security and surveillance. The council also greenlit the overhaul of T-72 and T-90 tanks and the engines of Sukhoi fighter aircraft.

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DAC approved the procurement of six Advanced Light Helicopters for the Indian Coast Guard to strengthen coastal security and surveillance in coastal areas. It has also given its approval for the overhaul of T-72 and T-90 tanks, and engines of the Sukhoi fighter aircraft.

Additionally, the DAC also approved procuring the Electronic Warfare Suite (EWS) comprising of external Airborne Self protection Jammer pods, next-generation radar warning receiver, and associated equipment for the Su-30 MKI aircraft.

Shares of these defense companies are staging a rebound, having recovered nearly 20% to 30% from their respective lows. However, despite the recent rebound, most of these stocks are still down between 20% to 40% from their record-high levels.

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In addition to this, Indian Navy Chief Admiral Dinesh K Tripathi said that the Indian Navy is close to finalising three significant deals worth Rs 1.25 lakh crore before the end of the current financial year. Bharat Electronics (BEL) is said to play a key role in the submarine program, while the submarines will be constructed through a collaboration between the French Naval Group and Mazagon Dock.

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