Solar Industries shares rise over 2% on defence indigenisation push; Jefferies bullish on private sector…

Reports coming in for today mention that Solar Industries India Ltd shares extended morning upside to well over 2 percent on Tuesday after Jefferies initiated coverage on the defence and explosives manufacturer with a 'buy' rating, citing firm expansion prospects for India's private-sector defence firms.

Solar Industries shares rose to Rs 22,460, up 2.3 percent from the previous close of Rs 21,950. The stock has surged around 84 percent so far in 2026, sharply outperforming the Nifty 50, which is down around 9 percent over the same period. The firm's market capitalisation stands at over Rs 2 lakh crore.

Jefferies initiated coverage on Solar Industries with a target price of Rs 28,160 per share, implying around 28 percent upside from Monday's closing price.

The brokerage anticipates Indian defence spending to grow at a double-digit compound annual expansion rate over the medium term, with the government's emphasis on domestic manufacturing providing a particularly firm opportunity for private-sector firms. Jefferies anticipates private defence firms to potentially deliver expansion of more than 20 percent.

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The bullish view comes as the government steps up defence procurement and pushes a greater share of orders towards domestic manufacturers.

The Defence Acquisition Council (DAC), chaired by Defence Minister Rajnath Singh, on Monday accorded Acceptance of Necessity (AoN) to acquisition proposals worth around Rs 1.10 lakh crore across the Army, Navy and Air Force. Around 98 percent of the proposed procurement has been earmarked for Indian industry.

The approvals cover a range of equipment, including Advanced Light Helicopters, high-mobility vehicles, mechanical mine layers, radars, marine gas turbines and ground-based multi-purpose jammers.

Motilal Oswal Financial Services stated defence acquisition approvals in FY27 so far have touched Rs 1.62 lakh crore, while approvals from FY25 through FY27 year-to-date total around Rs 13 lakh crore, expanding the addressable market for domestic defence manufacturers.

The brokerage additionally highlighted the government's move towards opening missile production to private-sector firms, which could further widen the opportunity for non-PSU defence manufacturers. It stated these initiatives improve order-inflow visibility for the domestic defence industry.