Jefferies Top 3 Defence Picks with Upside Potential up to 32%
Global investment firm Jefferies has identified its top defence sector picks in India, each offering substantial upside potential of up to 32% in 2025. As India continues to ramp up domestic defence production and reduce import dependency, defence stocks are emerging as strong investment opportunities.
Jefferies’ bullish outlook is based on sector tailwinds, government policy support, and solid order books of key players. Here are the top 3 defence picks according to the firm:
1. Hindustan Aeronautics Limited (HAL)
Upside Potential: ~32%
Why HAL?
HAL is a leader in aircraft manufacturing and servicing, with a robust order pipeline from the Indian Air Force and Navy. Jefferies sees continued demand for indigenous platforms like Tejas and helicopters, boosting HAL’s long-term earnings.
2. Bharat Electronics Limited (BEL)
Upside Potential: ~25%
Why BEL?
BEL is a key player in electronic warfare and defense communication systems. With strong revenue visibility, high margins, and alignment with India’s “Make in India” defence strategy, BEL is well-positioned for growth.
3. Mazagon Dock Shipbuilders
Upside Potential: ~20%
Why Mazagon Dock?
Mazagon Dock specializes in building submarines and warships. With a robust project pipeline and strategic importance in naval defence, the company offers stable long-term potential despite cyclical earnings.
Defence Sector Outlook for 2025
India’s focus on indigenisation, higher capital expenditure in defence, and export opportunities create a favorable backdrop for the sector. Jefferies expects strong multi-year tailwinds, particularly for companies with proven execution capabilities and government linkages.
FAQs
Q1. Why is Jefferies bullish on India’s defence sector?
Jefferies sees strong policy support, rising capital allocation, and increasing demand for indigenously developed systems as key growth drivers for the sector.
Q2. Which stock among the top 3 has the highest upside?
Hindustan Aeronautics Limited (HAL) offers the highest estimated upside of around 32%.
Q3. What makes BEL a strong pick?
BEL's leadership in defense electronics, strong margins, and alignment with self-reliant India initiatives make it a preferred pick.
Q4. Is the defence sector a good investment in 2025?
With ongoing geopolitical developments, increased defence spending, and reforms in procurement, the sector offers promising long-term potential.
Q5. Are these defence stocks suitable for long-term investors?
Yes, investors with a long-term outlook and moderate risk tolerance may benefit from the sector's structural growth story.
Published on: June 24, 2025
Uploaded by: PAVAN
www.vizzve.com || www.vizzveservices.com
Follow us on social media: Facebook || Linkedin || Instagram
🛡 Powered by Vizzve Financial
RBI-Registered Loan Partner | 10 Lakh+ Customers | ₹600 Cr+ Disbursed