Where Is the Real Money in India's Defence Value Chain?

Everyone watches HAL and the big shipyards land the headline contracts.

But the quiet winners are the Tier-2 subsystem suppliers — the ones building radars, avionics, and electronics.

Hard data:

•⁠ ⁠Tier-2 players like Data Patterns deliver 38–39% EBITDA

•⁠ ⁠Prime integrators like HAL manage only 22–23%

The edge comes from IP ownership, decades-long switching costs, and India’s aggressive indigenisation policy (560+ items now banned from import).

Policy is quietly shifting billions in value from foreign OEMs straight into the hands of domestic specialists.

In the defence decade, the smartest capital isn’t flowing to the headline makers — it’s moving one level down the value chain.

→ Deep dive in the full piece (sharp and worth reading): https://open.substack.com/pub/curiousinvestinginsights/p/the-defence-value-chain