Transportation companies, GRSE, BEL, HAL stocks climbed over 10%; geopolitical tensions continue to raise defense stocks?
Stocks of several defense and shipping companies rallied sharply on Friday, June 13, even as the benchmark index traded in red amid heightened geopolitical tensions. The gains have been made after Israel’s preemptive air strikes at Iran’s nuclear and military sites, sparking concerns over prolonged regional conflicts and undermining global trade sentiment.
Shipping companies in India (SCI) jumped over 10% to Rs 227.80, while GE Transport rose 5.2% to Rs 1,025. Both stocks are one of the highest interests of the Nifty 500.
Baltic dryness index soared 50% in a month; GE transports in the spotlight
The rally of transport stocks was also supported by a 50% increase in the month of the global freight barometer Baltic Dry Index (BDI). BDI soared 9% on Thursday alone, as vessels are expected to avoid Middle Eastern waters in the event of military escalation.
Analysts point out that GE Shipping’s large amount of oil and product tankers have exposed (which accounts for nearly 50% of its fleet) and believe it is a strong effect on the rise in cargo and tanker speeds. GE Transport shares trade at a 35% discount on free cash flows of over Rs 20,000 crore each year with high cash reserves and free cash flows.
SCI surges by 25% in one month
Indian shipping companies are also very attractive, soaring more than 25% in the past month. Although no analysts actively track the stock, investors are reevaluating due to India’s growing maritime ambitions, investors are strengthening transportation demand and strategic PSU positioning.
Hal, Bel, Paras Defense, Grse Rally rally at War Premium
In defence stocks, HAL jumped more than 2% to Rs 4,980, BEL rose to Rs 408, and Paras Defense traded nearly Rs 46, up nearly 3%. Garden Reach Reach Shipyard (GRSE), Cochin Shipyard, Zen Technologies, Bharat Dynamics (BDL) and Astra Microwave also released earnings in the 2-5% range.
Emergency defense purchase of Rs 400,000 crore, exports at all-time highest level
Brokers point to structural headwinds for defence stocks: India’s defense exports hit a record 23,6 billion rupees in fiscal 25 and are underway for emergency procurement of more than 4,0 billion rupees. The CCS approved project, worth Rs 22,500 crore, is also expected to be quickly tracked.
Israel remains one of India’s largest defense allies, and the escalating conflict could prompt faster permissions and commands for Indian defense PSU and private players, especially in drones, missile systems, space surveillance and tactical communications.
Positive prospects for domestic defense ecosystems
Choice Broking said the government’s push to promote localization under the “Atmanirbhar Bharat” initiative is expected to benefit from listed defense stocks. With increased attractiveness from global buyers, higher budget allocations in European and Middle Eastern countries may further increase orders and profit margins.
Market prospects
As crude oil prices soar more than 10% at $77 a barrel and face uncertain transportation routes, defense and transportation stocks may continue to outperform if tensions escalate further. Investors are advised to keep stock-specific and track delivery orders, strategic cooperation and earnings upgrades.
