 "ISRO Rocket")
Shares of space related companies like Mishra Dhatu Nigam (MIDHANI), MTAR Technologies, Data Patterns (India), Nelco, and Astra Microwave Products rallied up to 13 per cent on the BSE in Thursday's intraday trade, in an otherwise weak market, after the government on Wednesday eased Foreign Direct Investment (FDI) norms in the space sector by allowing 100 per cent overseas investment in making components for satellites, as part of efforts to attract overseas players and private companies into the segment.
These stocks, however, are still up to 26 per cent below their respective 52-week highs levels. In comparison, the S&P BSE Sensex was down 0.13 per cent at 72,529 at 01:42 PM.
The decision was taken at the Cabinet meeting chaired by Prime Minister Narendra Modi. The satellite sub-sector has been divided into three different activities with defined limits for foreign investment in each such sector, according to an official statement.
Presently, FDI in the space sector was allowed up to 100 per cent in the area of satellite establishment and operations through government route only, PTI reported. CLICK HERE FOR FULL REPORT
Among individual stocks, MIDHANI surged 13 per cent to Rs 458.60 on back of two-fold jump in average trading volumes. The stock had hit a 52-week high Rs 547.45 on February 5.
The company is engaged in production and supply of various Super Alloys, Special Steels/materials to defence and other strategic sectors for Nuclear, aeronautical and space applications.
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"The defence and aerospace sector is witnessing significant growth and there is a greater demand for high-value products and services. Defence Acquisition Policy (DAP) 2020 emphasises on over 50 per cent indigenous content for a majority of the procurement categories and MIDHANI can capitalise on this opportunity. Demand in associated sectors including aerospace manufacturing, space, electric vehicles, and railways to be tapped to obtain economies of scale," the company said in its FY23 annual report.
MTAR Technologies, meanwhile, soared 9 per cent to Rs 2,065 on the back of two-fold jump in trading volumes. The stock has corrected 35 per cent from a level of Rs 2,920 touched on September 11, 2023. The company is a leading manufacturer engaged in manufacturing and development of mission critical precision engineered systems catering to Clean Energy – Civil Nuclear Power, Fuel Cells, Hydel & Others, Space, and Defence sectors.
Data Patterns (India) rallied 6 per cent to Rs 2,178 on the BSE today. The company works closely with the defence PSUs such as Hindustan Aeronautics and Bharat Electronics as well as government organisations involved in defence and space research like Defence Research and Development Organisation (DRDO) and Indian Space Research Organisation (ISRO).
Astra Microwave Products gained 3 per cent to Rs 658.35 in the intraday trade. However, the stock has corrected 7 per cent from its record high level of Rs 690 touched on February 9.
The company is engaged in design, development and manufacture of sub-systems for Radio Frequency and microwave systems, primarily used in defence, space & meteorology. Product range includes radars, missile electronics, electronic warfare, satellites, MMIC (Monolithic Microwave Integrated Circuit) and communication systems.
The Government's focus on indigenisation, increasing usage of electronics in defence & space, strong order backlog, healthy orders pipeline and execution of high-margin domestic orders would drive earnings in coming period, according to analysts at ICICI Securities. The brokerage firm has a 'buy' rating on the stock with a target price of Rs 740 per share.
