Stocks to buy: India’s defence and aerospace sector continues to attract investor attention as the government pushes ahead with military modernisation, indigenous manufacturing and export expansion. Against this backdrop, domestic brokerage house Choice Institutional Equities highlighted several companies that are seeing strong order inflows, expanding execution pipelines and growing opportunities across defence platforms.
The brokerage maintained a positive outlook on the defence sector and pointed to robust order books, increasing localisation, export opportunities and new technology-led programmes as key growth drivers. As the report noted, defence companies are benefiting from rising military preparedness, indigenous procurement initiatives and growing demand for advanced systems across land, air and naval platforms.
“Recent geopolitical conflicts are accelerating military preparedness, driving strong demand for anti-drone systems and simulators, while the Indian government’s IDDM push supports indigenous defence solutions,” said the brokerage.
Choice Broking’s top defence picks
1. Hindustan Aeronautics Ltd (HAL): Choice Broking maintained a BUY rating on HAL with a target price of ₹5,050 against a CMP of ₹4,304. The brokerage highlighted the company’s massive order book of ₹2,54,538 crore at the end of FY26 and expects an additional ₹90,000 crore of orders over the next two years. Major programmes include the LCA Mk1A, ALH helicopters, Su-30 upgrades and Do-228 projects.
The report noted that HAL expects double-digit revenue growth of 10-12% in FY27 while maintaining EBITDA margins of 30-31%. The company has also planned investments of ₹12,000 crore by 2030 for manufacturing infrastructure related to LCA Mk2, IMRH engines and SSLV projects. Strategic partnerships with Safran, ISRO and international aerospace players further strengthen its long-term outlook.
2. Bharat Electronics Ltd (BEL): BEL received a BUY rating with a target price of ₹500 compared with a CMP of ₹411. According to Choice Broking, the company expects order inflows exceeding ₹55,000 crore in FY27, including the QRSAM programme. Its order book stood at ₹73,882 crore as of April 1, 2026.
The brokerage said BEL continues to benefit from high indigenous content levels of 80-85%, which support margin expansion. The company is also investing aggressively in future technologies, including AI, cybersecurity and directed energy weapons. Export opportunities remain another growth lever, with the company aiming to raise exports to over 10% of turnover within the next four to five years.
3. Zen Technologies: Choice Broking assigned a BUY rating to Zen Technologies with a target price of ₹1,850, compared with a CMP of ₹1,665. The company reported an order book of ₹1,336 crore as of March 31, 2026, with nearly ₹1,000 crore scheduled for execution during FY27. It has also provided cumulative revenue guidance of ₹4,000 crore for FY27 and FY28.
“Hyperstrike, the company’s AI-enabled interceptor drone, is expected by management to become its largest product within two years, supported by initial production capacity of roughly 5,000–15,000 units per shift per month beginning this year,” it stated.
The report further pointed out Zen’s growing anti-drone capabilities, naval simulation opportunities and cybersecurity solutions. Management also expects subsidiaries ARI and UTS to contribute around ₹365 crore of revenue in FY27.
4. Data Patterns: Choice Broking maintained an ADD rating on Data Patterns with a target price of ₹4,060 against a CMP of ₹4,043. The company recorded a 216% year-on-year increase in FY26 order inflows, reaching ₹1,121 crore. The effective order pipeline stands at ₹2,062 crore, including fully negotiated contracts worth ₹1,090 crore expected to close soon.
The brokerage informed that the company’s involvement in key defence programmes such as BrahMos seekers, AMCA cockpit systems, electronic warfare suites and anti-drone solutions. Data Patterns is also seeing growing export traction, with an export order book of ₹53 crore and increasing interest from global OEMs, it added.
5. Apollo Micro Systems: Apollo Micro Systems received an ADD rating with a target price of ₹365 compared with a CMP of ₹409. The company’s consolidated order book stood at ₹1,432 crore at the end of FY26, while management expects significant large-ticket orders during the current financial year.
“Apollo’s Vision 2036 strategy aims to transform the company from a Tier-1 electronics supplier into a global OEM across land, air and sea defence platforms, supported by acquisitions, capacity expansion and new defence technologies,” said Choice
It further noted that Apollo has secured a lifetime DPIIT licence covering a wide range of defence systems, including UAVs, radars, torpedoes, missiles and underwater mines. The company is also investing heavily in RF seeker development and expanding into new defence domains.
6. Centum Electronics: Choice Broking maintained an ADD rating on Centum Electronics with a target price of ₹3,300 against a CMP of ₹3,484. The brokerage highlighted the company’s strategic restructuring efforts, including the closure of underperforming overseas operations and a renewed focus on its core India ESDM platform.
The company is targeting a medium-term standalone revenue CAGR of 25-30%, supported by strong growth in its Build-to-Specification business. Its standalone order book increased 23% year-on-year to ₹1,645 crore, while the company secured key radar and space-tracking projects during FY26.
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.
