Defence stocks shine after hike in FDI limit

Mumbai: Shares of select Indian defence sector-linked companies surged on Monday after the government raised foreign direct investment (FDI) limit to 74 per cent from 49 per cent under the automatic route. Shares of Hindustan Aeronautics ended up 4.2 per cent at Rs 545.30 after touching a high of Rs 576 during the day. Shares of Taneja Aerospace ended up 5per cent at Rs 20.30. Astra Microwave Products ended up 5per cent at Rs 66.95. Walchandnagar Industries gained 4.15 per cent to close at Rs 36.40.

“The government raised the FDI limit which is a positive news. It won’t happen immediately but it is a positive step,” said AK Prabhakar, head of research at IDBI Cap. Bharat Electronics is Prabhakar’s preferred pick in the defence space from a three-year perspective.