India's Military Action Against Pakistan Sends Shockwaves to Stock Market

Strategic Insights -

Indian Prime Minister Narendra Modi visited the Adampur air force base near Jalandhar in East Punjab on Tuesday, reiterating the "new normal" of military action against Pakistan. However, the visit comes as a contrasting reality for the company that manufactures the Rafale jets, Dassault Aviation, whose stocks have plummeted due to the recent military engagement between Indian and Pakistani pilots. Meanwhile, shares of Chinese aerospace company Chengdu Aircraft Corporation, the maker of the J-10 fighter jets inducted by Pakistan, have surged by 20 per cent.

Key Takeaways:

  • Dassault Aviation's stock plummeted 7% in the European stock market following reports of India using Rafale jets in Operation Sindoor against Pakistan.
  • The stock of Dassault Aviation dropped sharply from 292 euros to 295 euros on Monday, reaching a low of 291 euros.
  • Shares of Chengdu Aircraft Corporation (CAC) surged by 20% on Monday, marking a significant rise in investor confidence for the Chinese aerospace company.
  • Dassault Aviation's annual sales reached 6.24 billion euros, and the company reported a net profit of 924 million euros in 2022.
  • Indian and French authorities recently signed a deal to procure 26 naval variants of Rafale fighter jets for the Indian Navy at a cost of around Rs63,000 crore (Rs630bn).
  • India has 36 Rafale fighters with Hammer and Scalp missiles operational in the Indian Air Force, with base maintenance depots, repairs, training, and simulators at the Ambala air base.

Statistics:

  • 7% - Dassault Aviation's stock drop in the European stock market following reports of India using Rafale jets in Operation Sindoor against Pakistan.
  • 20% - Shares of Chengdu Aircraft Corporation surged by on Monday.
  • Eur 292 - The low price of Dassault Aviation's stock during the intraday drop on Monday.
  • Eur 6.24 billion - Dassault Aviation's annual sales in 2022.
  • Eur 924 million - Dassault Aviation's net profit in 2022.
  • Rs63,000 crore (Rs630bn) - The cost of procuring 26 naval variants of Rafale fighter jets for the Indian Navy.

Sources:

  • Hindustan Times
  • Live Mint