Defence stocks on a roll! Sika Interplant, GRSE, Mazagon Dock, Zen Tech zoom up to 19% today; here's why

A majority of defence sector stocks saw a sharp rise in Monday's trade. Out of which, Sika Interplant Systems Ltd got the maximum push. The stock jumped 19.19 per cent to hit a one-year high of Rs 970 over its previous close of Rs 813.80. The scrip witnessed heavy trading volumes on BSE. Around 37,000 shares changed hands today as against a two-week average volume of 9,145 shares. Turnover on the counter stood at Rs 3.35 crore, commanding a market capitalisation (m-cap) of Rs 397.75 crore.

The company, in an exchange filing, said, "Sika Interplant has secured significant new orders for advanced engineering products and services in the recent past. With these recent contracts, the cumulative of new orders received by Sika since the start of FY 2023-24 is Rs 117 crore (approx.) as on August 11, 2023." The company provides advanced products and solutions to the aerospace and defence sector.

Among individual shares, shares of Garden Reach Shipbuilders & Engineers Ltd (GRSE) also rose sharply today. The stock surged 14.31 per cent to hit a 52-week high of Rs 666.45. Today's sharp upmove came after the company posted strong set of numbers in the June quarter (Q1 FY24).

GESE's net profit soared 52.81 per cent to Rs 76.68 crore in Q1 FY24 against Rs 50.18 crore in the year-ago period. The company's revenue also increased by 30.38 per cent to Rs 755.90 crore compared to Rs 579.77 crore in the corresponding period a year ago.

Mazagon Dock Shipbuilders Ltd moved 10.28 per cent higher to hit a day high price of Rs 1,919. In Q1 FY24, the state-run firm recorded a 39.80 per cent year-on-year (YoY) rise in net profit at Rs 314.30 crore.

Zen Technologies Ltd shares recorded a 5 per cent spike. The stock was locked at its upper price band of Rs 827.75. The company said it has received order worth of Rs 64.97 crore including GST (Rs 55.06 crore excluding GST) from the defence ministry.

Bourses BSE and NSE have put the securities of Zen Tech under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.

Rossell India Ltd 6.98 per cent to hit a day high of Rs 441.20. DCX India, Hindustan Aeronautics Ltd (HAL), CFF Fluid Control Ltd, Taneja Aerospace & Aviation Ltd, Paras Defence and Space Technologies Ltd, Data Paterns, MTAR Technologies Ltd and Apollo Micro Systems Ltd climbed up to 1.63 per cent.

Brokerage Phillip Capital said defence sector could see $110 billion in deal opportunities over the next 6-8 years. "Defence stocks are placed favourably because they offer long-term execution growth visibility, backed by robust order book and a healthy pipeline, timely execution due to localisation, integrated modular construction, moat of government preference, cash-rich balance sheets and appropriate tech support from DRDO," it said.

Meanwhile, Indian equity benchmarks turned positive in late deals amid a highly volatile session, aided by technology and consumer good stocks.

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