Defence Sector Stock, Is Heavy Selling Awaited ? Hindustan Aeronaut, Bharat Electronics, Bharat Dynamics, BHEL, Cochin Shipyard, Mazagon Dock, Bharat Forge.

Is defence sector stocks about to witness a short-term profit booking ? We are witnessing all the three major defence companies, HAL, BEL & BDL are witnessing some pressure in the stock prices. Most of these companies in the last 15 days have given exponential returns to their investor HAL & BEL also belongs to future and option segment which means that the traders must also have taken exposure in F&O segments around these stocks

After the result of HAL we witnessed that HAL have moved up by over 20%. On the other hand BDL which is a cash segment stock has moved by over 70%. Needless to say that in BDL, the news of stock split also played a big role. BEL and HAL both have given very strong numbers. We have seen improvement in revenues, net profit as well as improvement in EPS on year-on-year basis. The future forecast by both the companies and their orderbook is very robust. If you look at the EPS of BDL it’s now over hundred. HAL on the other hand is around 45 and BEL is around 54 so looking at the EPS figure we can say that BDL has already run & against its existing earnings figures looks overvalued in comparison to HAL and BEL.

Before the next quarterly result, we can see further momentum in HAL& BEL but currently the RSI of defence sector stocks are over 70 and 80 levels in some cases. We generally see some profit booking and consolidation for few days before stocks start their next movement.

Disclaimer :- All the facts & the figure presented in the article are taken from internet and all the opinion presented in the article are authors personal opinion and this is not at all an investment suggestion. Before any buying and selling in the stock, please check with your investment advisor.