Defence stocks set for mixed Q4; Nuvama bets on BEL, Solar Industries, and a smallcap pick

The defence sector continues to benefit from government 'Make in India' initiatives and geopolitical tensions, leading to strong order books. However, the market is now looking for execution and sustained growth beyond just order inflows.

Consider a 'buy on dips' strategy for fundamentally strong defence stocks, focusing on companies with clear execution pipelines and healthy margins, with a stop-loss below recent support levels.

For Indian markets, this story mainly matters for BEL, SOLARINDS, DATAPATTNS and the Defence pocket. The current signal is mixed, so traders should look for follow-through in price, volume, and sector breadth instead of reacting to the headline alone.

Watch whether the next market session confirms the setup described here: Identified as a top pick by Nuvama Institutional Equities for Q4FY26. Identified as a top pick by Nuvama Institutional Equities for Q4FY26. Also track volume confirmation, sector participation, and whether the move holds beyond the first reaction.

• •Defence sector companies anticipate mixed Q4FY26 results.
• •Nuvama Institutional Equities highlights BEL, Data Patterns, and Solar Industries as top picks.
• •Order inflows remain robust, but growth momentum is expected to moderate.
• •Defence stocks have seen a strong rebound in April, with further action anticipated post-earnings and geopolitical developments.
• •Risk flag: Moderating growth momentum despite strong order books could disappoint investors.