IIFL Securities recommends investors to 'add' Data Patterns shares

New Delhi, March 15 With thrust on defence spending and strong earnings, growth should help sustain Data Patterns rich valuations as compared to other defence-related PSUs, brokerage house IIFL Securities said.

Data Patterns is a vertically integrated electronics solutions provider having design capabilities across the entire spectrum of strategic defence and aerospace.

Also, it is looking at larger system integration opportunities in radars and electronic warfare and is pursuing prospects in avionics, nano satellites and exports.

The brokerage recommended investors to 'add' the stocks in their portfolio with a target price of Rs 758.

At 3.04 p.m., the shares traded at Rs 669, up 2.2 from the previous session's closing.

Focus on domestic defence procurement, increasing indigenisation and higher share of electronics in warfare is expected to drive 10-year compound annual growth rate (CAGR) of 16 per cent in the defence manufacturing segment, the brokerage said.

"With more than 30 years of presence, high entry barriers and strong capabilities, Data Patterns is poised to benefit."