Best Defence Stocks in India for Nov 2025: HAL, BDL and More on ROE Basis

India’s defence manufacturing sector is rapidly becoming a foundational pillar supporting the country’s strategic and economic objectives. Recognising its critical importance to national security and economic development, the government has placed this sector at the top of its agenda. This commitment is evident in the Ministry of Defence’s budget for 2023-24, which is the largest allocation among all ministries, highlighting a strong focus on bolstering indigenous defence capabilities.

This progress is driven by a well-coordinated strategy that integrates the Atmanirbhar Bharat initiative, production-linked incentive (PLI) schemes, and robust public-private partnerships. Over the past decade, India’s defence budget has more than doubled, rising steadily from ₹2.53 trillion in FY 2014 to an anticipated ₹6.81 trillion by FY 2026. In this article, we will explore the best defence stocks for Nov 2025 based on 5Y CAGR.

Best Defence Stocks Based on ROE

Note: The best defence stocks list is as of Oct 27, 2025. The stocks are sorted based on ROE. 

Overview of Top Defence Stocks

1. Hindustan Aeronautics Ltd

Hindustan Aeronautics is engaged in the business of manufacturing Aircraft and Helicopters and repairing and maintenaning Aircraft and Helicopters. HAL has recently commenced the third Production Line of Light Combat Aircraft (LCA) Tejas Mk1A and the second Production Line of Hindustan Turbo Trainer-40 (HTT-40) at the Nashik facility on October 17, 2025

Key Metrics:

• Return on Capital Employed (ROCE): 33.9%
• 1Y Return: 14.70%

2. Data Patterns (India)Ltd

Data Patterns (India) Limited is one of the fastest-growing companies in the Defence and Aerospace Electronics sector in India. It is among the few vertically integrated defence and aerospace electronics solutions providers catering to the indigenously developed defence products industry.

During Q1FY26, the company reported a total revenue of ₹110 crore, marking a 5.6% decline compared to ₹116 crore in the same quarter of the previous year. Revenue from operations also decreased by 4.6%, standing at ₹99.33 crore in Q1 FY26 compared to ₹104.1 crore in Q1 FY25.

Key Metrics:

• ROCE: 21%
• 1Y Return: 23.9%

3. Paras Defence and Space Technologies Ltd

Paras Defence and Space Technologies (PDST) is primarily engaged in the designing, developing, manufacturing, and testing of a variety of defence and space engineering products and solutions. Recently, Paras Anti-Drone Technologies Private Limited, a Subsidiary of PDST, has received an order from Ministry of Defence, Government of India valued at approximately ₹46.19 crores (incl GST) for Anti-Drone Systems such as Drone Jammers.

Key Metrics:

• ROCE: 15.6%
• 1Y Return: 48.71%

Also Read: Best Debt-Free Stocks for October 2025: Tata Investment, Maharashtra Scooters, GIC, UTI AMC, ZF CVCS

Conclusion 

Investing in defence stocks showcases a compelling opportunity for long-term growth, driven by strong government support, increasing defence budgets, and India’s push for self-reliance in defence manufacturing

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.