3 weeks ago
Three Defence Stocks Win Over Both FIIs and DIIs
Some big money managers in India are called FIIs, like investors from other countries, and DIIs, like large Indian investment companies.
Usually these two groups do opposite things, but this time they both bought shares in the same three companies.
These companies make things for defence, like drones, submarine periscopes, and special electronic parts for the military.
One company, Ideaforge, makes drones and even won an order from a police department in the United States.
Another company, Paras Defence, makes periscopes for submarines and is building a big semiconductor factory in Madhya Pradesh.
The third company, Astra Microwave, got a very large order from Hindustan Aeronautics for radar parts.
These companies also grew their sales and built up big order books this year.
But their shares are quite expensive compared to similar companies.
That means people are paying a lot of money for them today.
So, they might be good companies, but buyers need to be careful about the high price.
During Q1 FY27 (April-June 2026), both FIIs and DIIs raised their stakes in three aerospace and defence stocks.
Ideaforge Technology: FIIs increased stakes by 7.54 percentage points to 8.27% and DIIs by 9.78 points to 10.98%.
Paras Defence and Space Technologies: FIIs added 3.23% to reach 8.29%, while DIIs added 1.8% to reach 3.04%.
Astra Microwave Products: FIIs raised stakes by 3.18% to 10.7% and DIIs by 0.67% to 16.09%.
All three stocks trade at premium valuations compared with industry peers, with high PE, PEG and EV/EBITDA ratios.
Astra Microwave received a record Rs 2,205.23 crore order from HAL for the Uttam Radar programme, exceeding its FY26 closing orderbook.
Ideaforge won its first US order from the Lamar Police Department in Texas and became the first Indian drone maker to train NATO forces.
- Who
- Foreign institutional investors (FIIs) and domestic institutional investors (DIIs) bought stakes in Ideaforge Technology Limited, Paras Defence and Space Technologies Limited, and Astra Microwave Products Limited.
- What
- Both FIIs and DIIs simultaneously increased their stakes in three aerospace and defence sector stocks during Q1 FY27.
- Where
- India's domestic stock market.
- When
- Q1 FY27, covering April to June 2026.
- Why
- Reflecting growing institutional confidence in the defence sector's long-term growth prospects, though the stocks trade at premium valuations.
Institutional Optimism
Valuation Caution
Growth prospects
Institutional Optimism
Simultaneous FII and DII stake increases and record order books reflect growing institutional confidence in the defence sector's long-term growth prospects.
Valuation Caution
All three stocks trade at premium valuations (e.g., PE of 88.7x–123.6x vs industry median of 67.1x), suggesting a significant portion of future growth is already priced into share prices.
Future order flows
Institutional Optimism
Large orderbooks and new wins, such as Astra's Rs 2,205.23 crore HAL order, provide strong multi-year revenue visibility and support ambitious growth plans.
Valuation Caution
The article notes order execution is the key factor determining whether companies deliver on growth plans, and it is not a recommendation, urging investors to consult advisors.
Key facts
- Sector
- Aerospace and Defence
- Quarter
- Q1 FY27 (April-June 2026)
- Ideaforge FII/DII stake
- 8.27% / 10.98% at quarter end
- Paras Defence FII/DII stake
- 8.29% / 3.04% at quarter end
- Astra Microwave FII/DII stake
- 10.7% / 16.09% at quarter end
- Astra Microwave HAL order
- Rs 2,205.23 crore for 122 AAAU and 121 Interface Frames (Uttam Radar programme)
- Paras Defence orderbook
- Rs 986 crore at end of FY26
- Ideaforge FY26 sales
- Rs 226 crore, up 40.37% YoY; loss narrowed to Rs 17 crore










