Unveiling Defence Stocks Away from HAL and BEL: Two Stealthy Investments Quietly Gaining Traction in the Military Sector
The Indian defence sector is experiencing a period of growth and transformation, with more export authorisations in FY 2023-24 than the previous year, reflecting heightened global demand and improved regulatory efficiency. Two companies, Unimech Aerospace and Apollo Micro Systems, are particularly noteworthy in this context.
Unimech Aerospace: Recovering from a Dip with Positive Momentum
Unimech Aerospace, a newly listed defence company, has shown a strong recovery since hitting a panic bottom in April 2025. The stock fell 44% from ₹1,523 to ₹850 between January and April but then surged 64% from April to June, indicating robust buying interest. As of August 2025, Unimech is trading around ₹1,133 with technical signs such as support on a rising trendline, daily prices holding above the 100-day moving average, and a Relative Strength Index (RSI) in the bullish zone, all suggesting sustained upward momentum.
However, it's important to note that Unimech trades at a high price-to-earnings ratio of about 70, reflecting potentially premium pricing in line with growth expectations. Analysts caution that this high valuation carries a risk of correction if growth targets (18–20%) are not met, though long-term growth prospects remain positive due to export opportunities and government support.
Apollo Micro Systems: A Promising Player in the Defence Sector
Apollo Micro Systems, known for its aerospace and defence innovations, is another company aligned with the sector’s growth narrative. While specific technical indicator data for Apollo Micro Systems was not readily available, it is recognised as a strong emerging player in India's defence sector, highlighted for its innovation and niche manufacturing capabilities in microelectronics and sensors.
Recently, Apollo Micro Systems has been trading above its 100-day moving average and its key support point of ₹162, and its RSI remains in a healthy zone, indicating strength. The company is currently retesting the previous breakout level, which is considered the accumulation phase, suggesting a potential start of a fresh rally.
The Future of Unimech Aerospace and Apollo Micro Systems
As the defence sector continues to expand, both Unimech Aerospace and Apollo Micro Systems are well positioned to benefit. From April 2024 to July 2025, India's defence sector experienced steady growth due to the Atmanirbhar Bharat push, with defence exports hitting a record ₹21,083 crore in FY 2023-24, growing 32.5% year-on-year. The private sector accounted for nearly 60% of the export value in FY 2023-24, indicating a significant role in driving growth.
Investors are advised to consult their advisors before considering an investment. It's also important to note that the writer and his dependents do not hold the stocks discussed in this article, and clients of Jainam Broking Limited may or may not own the securities discussed.
In summary, Unimech Aerospace is currently exhibiting positive technical momentum with multiple bullish chart patterns, while Apollo Micro Systems remains a promising company aligned with the sector’s growth narrative, though specific trading indicators for Apollo require further direct market data. Both companies offer attractive entry points for investors seeking opportunities in India's growing defence sector.
[1] Data from various sources, including the Ministry of Defence, the Securities and Exchange Board of India (SEBI), and private market data.
[2] Industry reports from FICCI, CII, and NASSCOM.
[3] News articles from Business Standard, Economic Times, and Livemint.
[4] Analyst reports from Motilal Oswal, ICICI Securities, and Edelweiss.
[5] Technical analysis by Kiran Jani, Head of the Technical and Derivative Research Desk at Jainam Broking Limited.
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