Discover: Why Will Defence Stocks Be The Focus On Monday?

In a landmark decision heralding a new era of self-reliance, the Defence Acquisition Council (DAC) convened under the stewardship of Raksha Mantri Shri Rajnath Singh, accorded approval for Acceptance of Necessity (AoNs) for various capital acquisition proposals amounting to Rs 84,560 crore. With an unwavering commitment to ‘Aatmanirbharta’—self-sufficiency—the approvals, bestowed on February 16, 2024, bear a distinct imprint: an unyielding emphasis on sourcing diverse equipment from indigenous vendors.

Strengthening Ground Forces: Innovative Solutions for Enhanced Defense

Under the banner of ‘Buy Indian-Indigenously Designed Developed and Manufactured (IDDM)’ classification, the DAC greenlights the procurement of a groundbreaking lineage of Anti-tank mines, armed with seismic sensors and remote deactivation capabilities fortified with additional safety features. Moreover, to fortify the operational prowess and dominance in the Tactical Battle Area, the DAC channels its endorsement towards the acquisition of the Canister Launched Anti-Armour Loiter Munition System, under the same coveted IDDM category.

Enhancing Air Defense Capabilities: Precision and Vigilance in the Skies

Venturing further into the domain of Air Defence Systems, the DAC’s imprimatur extends to the procurement of Air Defence Tactical Control Radar, a strategic maneuver aimed at bolstering capabilities to detect slow, small, and low-flying targets, alongside elevating surveillance, detection, and tracking efficacy across varied targets.

Vigilance Over Maritime Terrains: Maritime Surveillance and Interception Capabilities Reinforced

In a bid to augment maritime surveillance and interception capabilities, the DAC extends its imprimatur to the procurement of Medium Range Maritime Reconnaissance and Multi-Mission Maritime Aircraft, threading through the avenues of the Buy and Make category, a move poised to fortify the vigilance armory of both the Indian Navy and the Indian Coast Guard over the expansive maritime terrain.

Maritime Defense Reinforcement: Strengthening Naval Fleet Against Potential Threats

In a proactive stance against potential threats looming over the Indian Naval fleet, the DAC sanctions the acquisition of Active Towed Array Sonar and Heavy Weight Torpedoes, amplifying the detection and offensive capabilities of Kalvari Class submarines, thus ensuring an indisputable edge in maritime defense.

Bilateral Defense Ties Strengthened: Ensuring Longevity and Operational Support

Noteworthy too is the DAC’s endorsement of sustainment support through Follow On Support (FOS) and Repair Replenishment support via Follow On Supply Support (FOSS) for 24 MH60R aircraft, procured through the Foreign Military Sale route with the US Government, thereby cementing bilateral defense ties while fortifying operational longevity.

Expanding Operational Reach: A Leap in Airborne Refueling and Communication

Elevating the Indian Air Force’s operational reach, the DAC unfurls its imprimatur for the acquisition of Flight Refueller Aircraft, a pivotal stride towards extending operational capabilities to unforeseen heights. Concurrently, the DAC extends its aegis to the Indian Coast Guard, sanctifying the procurement of Software Defined Radios, pivotal for fostering seamless information exchange and high-speed communication with secure networking capabilities.

Paving the Way for Innovation: Amendments in Defense Acquisition Procedure

Furthermore, in a testament to fostering an environment conducive to defense innovation, the DAC orchestrates amendments in the Defence Acquisition Procedure (DAP) 2020, envisaging benchmarking and cost computation refinements, payment schedule streamlining, and procurement quantity modulation, laying the groundwork for a fertile breeding ground for defense startups and MSMEs under the Innovations for Defence Excellence (iDEX) and Technology Development Fund (TDF) schemes, thus epitomizing the ethos of ‘Ease of Doing Business’ in its truest essence.

Stocks to Watch: Potential Beneficiaries of DAC’s Approvals

– New generation of Anti-tank mines: Bharat Forge

– Canister Launched Anti-Armour Loiter Munition System: Solar Industries and BDL

– Air Defence Tactical Control Radar: BEL, Astra Microwave, and BEML

– Medium Range Maritime Reconnaissance and Multi-Mission Maritime Aircraft for Coast Guard: HAL, BEL, Astra Microwave, Data Pattern

– Active Towed Array Sonar for Navy: BEL

– Heavy Weight Torpedoes for Navy: BDL and Apollo Micro System

– Follow On Supply Support (FOSS) for 24 MH60R aircraft: HAL (FMS route from USA)

– Flight Refueller Aircraft for Indian Air Force: HAL

– Software Defined Radios for Coast Guard: BEL, Data Pattern, Astra Microwave

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.