Defence Stocks Plunge 4% Amid Profit Booking; Long-Term Outlook Strong?

• Defence stocks fell up to 4% for the third consecutive day; Nifty Defence index dropped 1.5% today, over 2% in three days.
• Mazagon Dock Shipbuilders, Solar Industries India, and Data Patterns India saw the steepest declines.
• The decline occurred despite the Defence Acquisition Council (DAC) recently approving ₹79,000 crore procurement proposals.
• Brokerage PL Capital highlights ₹3.30 lakh crore 'Acceptance of Necessity' (AoN) approvals, ensuring long-term order visibility.
• Motilal Oswal notes AoNs reduce order flow risk for defence companies for 2-4 years, despite short-term profit booking.

Why It Matters: Defence stocks face short-term profit booking, but massive government orders signal strong long-term growth.