Israel-Iran war: Mazagon Dock, GRSE, Bharat Dynamics, other defence stocks rally. Do you own any of these?

Defence stocks in India witnessed a sharp rally on Tuesday as the ongoing conflict between Israel and Iran entered its fifth day, heightening geopolitical tensions. The Nifty India Defence Index climbed over 1.6% during the session, breaching the 9,000 mark.
Mazagon Dock Shipbuilders share price emerged as the top performer on the index, surging more than 5%. Garden Reach Shipbuilders & Engineers shares jumped over 4%, while Data Patterns (India) shares advanced more than 3%. Other major gainers included Bharat Dynamics, Cochin Shipyard, Solar Industries India, BEML, and Hindustan Aeronautics (HAL), which rose between 1% and 2%.
In contrast, Zen Technologies, Mishra Dhatu Nigam, and Astra Microwave Products shares traded marginally lower, bucking the broader trend.
The renewed investor interest in defence stocks was driven by expectations of increased defence spending and order inflows amid rising global security concerns. The escalation of the Israel-Iran conflict has intensified market anticipation of higher demand for defence equipment and services, analysts said.
Defence stocks had already gained traction last month following India's targeted military strikes on terrorist outfits in Pakistan under Operation Sindoor. While tensions between India and Pakistan have since de-escalated, the prolonged Russia-Ukraine conflict continues to underpin bullish sentiment in the sector.
The latest developments in the Middle East have further strengthened the outlook for India's defence stocks, with investors betting on sustained growth in defence orders and strategic investments.
However, analysts have flagged valuation concerns following the recent sharp rally in defence stocks.
'While defence stocks such as Garden Reach, Mazagon Dock, HAL, BEL, and BDL remain attractive from a long-term perspective, current valuations appear stretched. The recent uptrend is largely driven by sentiment and prevailing geopolitical narratives,' said Avinash Gorakshakar, Head of Research at Profitmart Securities.
He advised investors to consider accumulating these stocks with a long-term horizon of at least two years.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

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