Shares of drone manufacturers Ideaforge Technology, Droneacharya Aerial Innovations, Paras Defence, and Zen Technologies surged by as much as 17 percent on May 9, following rising tensions between India and Pakistan. During the trading session, stocks of Droneacharya and Zen Technologies also hit their 5 percent upper circuits.
In addition to the rally in drone stocks, other defence-related shares such as Bharat Dynamics (up 8 percent), Bharat Electronics (up 4 percent), and Mazagon Dock Shipbuilders (up 2.5 percent) were also trading in the green.
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Tensions between India and Pakistan escalated on May 8 when Pakistan launched a series of missile and drone strikes on over 15 military and civilian targets across Jammu & Kashmir, Punjab, and Rajasthan.
The Indian Air Defence system responded by intercepting and neutralising 7 to 8 aerial threats using the S-400 and Akash missile systems and also shot down two Pakistani fighter jets. In a simultaneous move, Pakistan shelled several forward Indian areas including RS Pura, Samba, Kupwara, and Baramulla, which triggered a proportionate response from the Indian side.
Authorities imposed power blackouts in the affected regions, while the Indian Defence Ministry stressed that its response was both measured and non-escalatory.
Among the individual gainers, Ideaforge saw stock price gains despite reporting weak financial results for the March quarter. The company posted a net loss of Rs 26 crore, compared to a net profit of Rs 10 crore in the same quarter last year. Revenue fell sharply by 80 percent year-on-year, coming in at Rs 20 crore, down from Rs 102 crore a year ago.
Meanwhile, Bharat Forge Chairman and Managing Director Babasaheb Neelkanth Kalyani revealed to CNBC-TV18 that the government has summoned defence equipment manufacturers to Delhi, in response to a question about whether the company was asked to scale up production.
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