What's next for defence stocks?

The defence sector has come into sharp focus following India's retaliatory attacks targeting terrorist infrastructure in Pakistan and Pakistan-occupied Jammu & Kashmir early Wednesday.

- Srushti Vaidya

As during any cross-border conflict, the escalating tensions between the nuclear-armed neighbours are likely to boost earnings for domestic defence companies. A strong and resilient export outlook further strengthens the sector's prospects, said experts.

Since the terror attack on tourists in Pahalgam on 22 April, the Nifty Defence index has increased 2.99%, significantly outperforming the Nifty 50, which has gained 1.2% over the same period. After India's attacks, code-named 'Operation Sindoor', the Nifty 50 and Sensex held strong despite early jitters, ending the day's trading session in the green.