Defence stocks face mixed Q2 outlook
ICICI Securities expects private defence companies to outperform PSUs in Q2 FY27, while OI Charts data showed mixed trends in HAL and BEL alongside gains in Azad Engineering. Derivatives positioning placed key reference levels around upcoming October expiries.
after close1 source ↓machine-written, see hownot a recommendation
- AZAD close
- ₹2,910
- On the day
- +0.92%
- 52-week high
- ₹3,128
- 52-week low
- ₹1,360
Indian defence stocks entered the September-quarter results season with a mixed outlook, as ICICI Securities expected private-sector companies to outperform public-sector undertakings in Q2 FY27. The brokerage remained constructive on Hindustan Aeronautics, Bharat Electronics and Azad Engineering, citing stronger execution, higher realisations and company-specific growth drivers. Defence demand remains supported by domestic procurement and order execution, but quarterly performance is likely to vary across businesses. 🛡️
According to the brokerage’s Q2 preview, most private defence companies could post higher double-digit revenue growth, while PSU defence companies may deliver growth ranging from flat to the lower double digits. PSU margins may remain steady or contract because of product-mix changes and execution patterns. Historically weaker first-half execution also makes order timing and revenue recognition important variables for the September quarter.
OI Charts data for 9 Oct 2026 showed Azad Engineering at ₹2,910, up 0.92% on the day. The stock had gained 3.8% over 20 sessions and remained below its 52-week high of ₹3,128 recorded on 30 Sep 2026. Its volume was 495,620 shares, indicating active trading ahead of the results season.
Bharat Electronics closed at ₹368.15, up 0.23%, with volume of 17.2 million shares. However, it was down 9.3% over 20 sessions. Its futures showed long build-up, with open interest rising 3.6% and the contract trading at a 0.65% premium. In the 27 Oct 2026 expiry, the ₹400 strike held the largest call and put open interest, while max pain stood at ₹390. These levels define the key derivatives reference points as results approach.
Hindustan Aeronautics closed at ₹4,656, up 0.18%, but remained down 6.9% over 20 sessions. Futures open interest rose 0.5% in a long build-up, with a 0.57% premium. For the 27 Oct 2026 expiry, the largest put open interest was at ₹4,600, the largest call open interest at ₹5,000 and max pain at ₹4,750.
Investors will focus on September-quarter revenue growth, order execution, realisations, margins and management commentary on the second half. The results dates and any changes in order visibility will determine whether private-sector outperformance broadens across the defence supply chain. 🚀
Source: Livemint, 11 Oct 2026
Not investment advice. For informational purposes only.