Modi 3.0 is not just a political headline — it’s a multi-billion-dollar trigger for India’s defence sector After securing a third term in office, the Modi government is doubling down on indigenous defence production. From massive DRDO contracts to private sector partnerships, India’s defence spending is on fire — and investors are quietly building positions in select defence stocks before the boom becomes mainstream.
As someone who’s closely tracked the defence and PSU stock
space since 2016, let me tell you this — defence is the dark horse sector of
2025.
Here are 5 top
defence sector stocks that are set to benefit massively under Modi 3.0.
1. Hindustan
Aeronautics Ltd (HAL)
Why to Watch:
HAL has become the crown jewel of India’s defence
manufacturing. With growing orders for Tejas fighter jets, helicopters, and
export contracts, HAL is now a global player.
Modi 3.0 Impact:
Increased focus on indigenization of air power, more defence
exports, and HAL’s R&D getting full government backing.
Bonus Trigger:
Joint ventures with international aerospace companies +
strong order book growth.
Why to Watch:
BEL is India’s leading defence electronics and radar systems
company. It’s at the heart of India’s surveillance, missile systems, and smart
weaponry.
Modi 3.0 Impact:
Big push toward border security tech, surveillance
equipment, AI-based defence tech — all favor BEL.
Bonus Trigger:
BEL’s growing exports and collaborations with DRDO and ISRO.
Why to Watch:
This government-backed PSU builds submarines and warships.
And guess what? The Navy is in the middle of a modernization spree.
Modi 3.0 Impact:
Increased defence budget allocation to maritime strength —
Project 75 and beyond to benefit MDL.
Bonus Trigger:
Attractive valuations + consistent dividend payouts make it
a PSU gem.
Why to Watch:
A niche defence electronics company that focuses on
high-margin, high-tech solutions like avionics, radars, and control systems.
Modi 3.0 Impact:
Private participation in Make-in-India defence is being
heavily promoted. Data Patterns is perfectly placed.
Bonus Trigger:
Small-cap growth potential + strong financials make it a
multi-year story.
Why to Watch:
A favorite among retail investors, Paras is into
cutting-edge defence and space optics, EW systems, and drones.
Modi 3.0 Impact:
Increased space defence initiatives + DRDO collaborations in
optics & AI-driven defence tech.
Bonus Trigger:
Emerging AI warfare focus — Paras is one of the few Indian
companies working in this futuristic space.
“India doesn’t want to be a buyer of defence equipment
anymore — it wants to be a global supplier.”
That’s not a quote from a stock market analyst. That’s PM
Modi’s vision for India’s defence future.
If you’re an investor looking to bet on the next decade of
Bharat’s military modernization, these 5 stocks should be on your 2025
watchlist.
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FAQs on Defence Sector Stocks (2025)
Q1. Are defence stocks safe for long-term investment?
Yes, many are backed by the Indian government, have strong
order books, and benefit from national defence policies.
Q2. Which is the best
defence PSU stock in 2025?
HAL and BEL are top picks due to consistent performance,
government backing, and global expansion.
Q3. Will Modi 3.0
increase defence spending?
Absolutely. Multiple reports confirm a record increase in
budget allocation toward indigenization and R&D.
Q4. Are private
defence stocks better than PSUs?
Private defence stocks like Paras and Data Patterns offer
higher growth, but come with more volatility.
Q5. Where can I track
defence contracts and stock updates?
Follow DRDO, Ministry of Defence announcements, and reliable financial news portals. Also, stay updated on this blog.
Piyush Sharma is a long-term equity investor and founder of MultibaggerStockIdeas.com. With over 15 years of experience in Indian stock markets, he shares research-backed investment insights, personal lessons, and practical strategies for identifying multibagger stocks early.
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