Aerospace, defence & shipbuilding.

This is NIC 30 transport equipment (ships, boats, railway rolling stock, aircraft, spacecraft, military vehicles) — the smallest manufacturing industry in the Atlas by value added at an estimated ₹0.7 lakh crore GVA in FY26, or 0.22% of national GVA and 1.5% of manufacturing GVA. It is dominated by state-owned enterprises (HAL, four defence shipyards, Bharat Dynamics, seven ordnance companies, Indian Railways' own production units), with private capacity (L&T, Tata Advanced Systems, Bharat Forge's Kalyani group, Adani, and listed small-caps) growing from a low base. Growth is driven almost entirely by government budgets — defence capital acquisition and railway capital outlay — rather than by consumer demand, with policy shifts since 2014-16 (Buy Indian-IDDM, indigenisation lists, ordnance corporatisation) lifting nominal growth from ~7-8% to a base-case 15.6% (FY26-30) and 12.0% (FY30-35). The chapter's central finding is that the equity market has priced the industry far ahead of its current economic scale: listed pure-play market capitalisation of ~₹6.3 lakh crore is about six times the industry's share of national GVA, the highest Equity Representation Ratio of any manufacturing sub-sector in the Atlas.

Estimated GVA

0.7 ₹ lakh crore (0.22% of national GVA; 1.5% of manufacturing GVA) · FY26

Defence production (gross output)

1.5 ₹ lakh crore (DPSUs ~78%, private ~22%) · FY25

Defence budget incl. pensions

6.8 ₹ lakh crore (capital acquisition ~₹1.2 lakh crore) · FY26

Defence exports

24,000 ₹ crore (≈ US$2.8 bn; ₹686 crore in FY14) · FY25

Employment

~0.5 million (DPSUs, rail production units, private & MSME supply chain) · FY26

Listed market capitalisation (pure-plays)

~6.3 ₹ lakh crore (~₹10 lakh crore incl. BEL & Solar) · Jul-2026

Ship Building sector P/E

61x trailing (vs 30x 10-year average); PAT ₹2,990 cr; revenue ₹18,567 cr; mcap ₹1.83 lakh crore · Jul-2026

HAL order book

~1.9 ₹ lakh crore (~6 years of revenue) · FY26