HDFC Defence Fund Boosts Holdings in HAL, Bharat Electronics and Other Defence Stocks in September 2026

Written by: Team Angel OneUpdated on: 16 Oct 2026, 5:06 pm IST

In September, HDFC Defence Fund raised its stakes in major defence stocks, including HAL and Mazagon Dock. Portfolio adjusts involve stakes in 10 companies.

In September 2026, the HDFC Defence Fund expanded its investments in several key defence stocks, including Hindustan Aeronautics Limited (HAL), Mazagon Dock Shipbuilders, and Bharat Electronics, as per The Economic Times news report citing ACE MF. This activity is part of the fund's broader strategy to increase its exposure to the defence sector.

Key Investment Moves by HDFC Defence Fund

The HDFC Defence Fund added 1 lakh shares of Hindustan Aeronautics to its portfolio, increasing the total to 31.05 lakh shares, up from 30.05 lakh shares in August.

Additionally, it bolstered its holdings in Mazagon Dock Shipbuilders by acquiring 48,000 shares, bringing the total to 17.25 lakh shares. The fund also increased its stake in Bharat Electronics by adding 20 lakh shares, totalling 4.40 crore shares by the end of September 2026.

Additional Investments and Reductions

Apart from these key stocks, the fund saw significant additions in other companies. Bharat Forge saw a near 3.96 lakh share increase, bringing its total to 77.02 lakh shares.

Eicher Motors and Tata Motors’ stakes grew by 1.50 lakh and 1.04 lakh shares respectively. The fund also invested in Bharat Dynamics, BEML, Astra Microwave Products, and Bosch.

Portfolio Adjustments and Sectoral Allocation

In its portfolio, the fund decreased its holdings in Solar Industries India by selling 14,825 shares, reducing the total to 6 lakh shares. The fund maintained its holdings in 13 other stocks, reflecting a stable investment strategy in these companies.

The fund’s allocation spanned across seven sectors, with a majority 53.92% in capital goods, followed by 22.74% in automobiles & ancillaries, and 13.06% in the chemicals sector. These adjustments indicate a strategic focus within the sector.

Top 10 Holding by Asset % of HDFC Defence Fund

Company name	Sector name	Asset %	1-Year Change (%)
Bharat Electronics Limited	Capital Goods	14.87%	−7%
Bharat Forge Limited	Automobile and Auto Components	12.91%	+49%
Hindustan Aeronautics Limited	Capital Goods	12.61%	+1%
Solar Industries India Limited	Chemicals	10.28%	+44%
Astra Microwave Products Limited	Capital Goods	6.44%	+57%
BEML Limited	Capital Goods	5.11%	−11%
MTAR Technologies Limited	Capital Goods	5.09%	+230%
Eicher Motors Limited	Automobile and Auto Components	4.67%	+3%
Bosch Limited	Automobile and Auto Components	4.10%	+17%
Bharat Dynamics Limited	Capital Goods	3.19%	−25%

Note: The above data is as of October 16, at 10:35 AM.

HDFC Defence Fund Performance

Despite stronger shorter-term returns, the HDFC Defence Fund underperformed against its benchmark over a 3-year period, recording returns of 34.36% against the benchmark's 41.55%. The fund delivered 18.48% over the last 6 months, surpassing its benchmark which stood at 11.18%. Managed by Rahul Baijal and Priya Ranjan, the fund holds 24 stocks and operates with an AUM of ₹11,493 crore as of September 2026.

Conclusion

HDFC Defence Fund increased its stakes across 10 companies, including Hindustan Aeronautics and Bharat Electronics, while reducing its exposure in Solar Industries India. The fund’s portfolio coverage remained consistent across 24 stocks with significant allocation in capital goods.

Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or 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.

Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.

Published on: Oct 16, 2026, 11:36 AM IST

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