Stocks to Buy: Top Picks in Defense Stocks: Solar Industries, Azad Engineering, and Astra Identified as Potential Multibaggers by ICICI Securities

Stocks to Buy: ICICI Securities Identifies Solar Industries, Azad Engineering, and Astral as Multibagger Picks in the Defense Sector; Dynamatic Technologies Receives Positive Rating, Awaits Pinaka Order Award Amid Increasing Ordering Activity.

ICICI Securities‘ Top Picks in the Defense Sector: Solar Industries, Astra Microwave, and Azad Engineering Identified as Multibagger Stocks. These companies have seen their share prices rise by 147-217% over the past year, delivering significant returns to investors.

ICICI Securities remains optimistic about the sector, citing a robust order pipeline and management forecasts of 15–25% revenue growth with maintained margins for FY25,” stated in its latest report.

ICICI Securities maintains a BUY rating on Dynamatic Technologies with a target price of ₹10,250. They anticipate the imminent award of the Pinaka order, which they believe is in advanced stages. Solar Industries’ share price is also expected to benefit from this development. Additionally, ICICI Securities is awaiting orders for QRSAM and MRSAM (Quick Reaction and Medium Range Surface-to-Air Missiles), which are likely to boost Bharat Electronics, Bharat Dynamics, and Astra Microwave’s share prices.

Ordering activity has accelerated over the past month following the conclusion of the Lok Sabha Elections.

In June 2024, significant developments included the expected delivery of the first Tejas Mk-1A aircraft in July ’24. Hindustan Aeronautics Ltd also received a Request for Proposal from the Ministry of Defence for the procurement of 156 LCH Prachand helicopters. Additionally, Hindustan Aeronautics Ltd secured orders worth ₹1170 crore from Cochin Shipyard.

According to ICICI Securities data, Garden Reach Shipbuilders & Engineers Ltd secured orders totaling ₹1910 crore, while Bharat Electronics secured orders totaling ₹3170 crore. Cochin Shipyard also received orders worth ₹1100 crore. In addition, Solar Industries has recently developed three new explosives.

ICICI Securities has set a target price of ₹13250 for Solar Industries, suggesting over 13% potential upside from the current market price of ₹11710. They have also set a target of ₹935 for Astra Microwave and ₹1750 for Azad Engineering, representing 2-4% higher targets compared to their current trading levels. Therefore, any corrections in these stock prices could present a favorable buying opportunity.