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DRDO has initiated the process to select private companies as Strategic Weapon Partners under the Development-cum-Production Partner model

ICICIdirect Research 19 Aug 2026 DISCLAIMER

News: DRDO has initiated the process to select private companies as Strategic Weapon Partners under the Development-cum-Production Partner model for strategic missile and weapon systems. At least two companies will be shortlisted for each project to jointly develop prototypes with DRDO and subsequently undertake production once systems are ordered in large numbers by the strategic forces. The programme covers Agni-series missiles, future variants of nuclear weapons and submarine-launched systems. Companies will be evaluated on technical and financial qualifications, including minimum turnover/net worth exceeding 5% of the expected work value, proven project-management expertise, a track record of executing production orders of similar scale and the capability to undertake bulk production of more than 50/100 units. A DRDO expert panel will also assess the shortlisted companies’ capabilities through visits to their facilities

View: The initiative could materially expand the addressable opportunity for private defence companies by opening high-value strategic weapon programmes beyond the traditional DPSU-led manufacturing model. We believe that companies like Solar Industries, L&T defence, Adani Defence , Bharat Forge and Tata Advanced Systems would remain key beneficiaries apart from Bharat Dynamics as primary PSU manufacturer. While companies such as Astra Microwave, Data Patterns and Paras Defence could benefit from the broader opportunity across missiles, warheads, guidance, RF/electronics and seeker-related systems. The selection of at least two partners per programme should also create a wider and more competitive private-sector manufacturing ecosystem as these systems transition from development to serial production.

Impact: Positive

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