Spoils of War – Some Indian companies are also gaining from the war

Upstream oil holds up amidst the war

As crude rallied sharply from $60/bbl to $100/bbl in little over a month, the positive impact was felt in upstream Indian oil stocks like ONGC, Oil India, and Vedanta Ltd. Commodities tend to gain from shortages and that is where Vedanta is seeing a dual benefit as its portfolio of oil and minerals gives it a unique advantage. The stock of Vedanta has rallied 14.2% since the start of 2026, and in the same period Nifty cracked by -7.2%. The outperformance is largely due to its combination of oil and minerals, with the later being less regulated. Even ONGC is up 10.97% since the start of 2026, compared to the correction in the Nifty. Oil India has also been an outperformer.

##Defence stocks gain from war spends

The relationship is almost logical. War not only leads to more defence spending, but even other countries spend more on defence to prop up their defences. When it comes to national security, no country wants to take chances. The best option is to spruce up your own defences with heavy defence spending. Here again, Indian defence stocks find itself in a sweet spot. They are not only going to gain more orders from the Indian defence forces, but also more export orders are likely to come by. Not surprisingly, on a YTD basis, Bharat Electronics is up 10.4% while Bharat Dynamics is up 5.3% in the last one month, as it expects direct gains from the war. These gains could be more immediate.

##Interesting alternatives to gas emerge

When TTK Prestige rallied by 17% in a week, it did take a lot of market players by surprise because the stock had actually underperformed over the last 3 years. However, TTK Prestige is one of the leading players in the Induction Cooktop segment. As the gas shortage became more obvious, the bet was that household LPG and CGD supplies would soon get disrupted. Not surprisingly, an induction cooktop running on electricity seemed to be a good alternative. As the story became obvious, even other players in the induction cooktop business like Bajaj Electricals and Havells outperformed the Nifty in the short run. Like induction cooktops, there are several alt-gas stories that are building up.

Better to be cautious of the macros

Behind the euphoria of bottom fishing and alpha hunting in such wild markets, there remain the bigger macro risks. For instance, oil at $100/bbl is already imposing a huge inflation cost on India. Goldman Sachs has already downsized India’s real GDP growth for FY26 and for FY27. The current rally in oil prices has already contributed nearly 70-80 bps to the inflation spike. The industry impact will show up in WPI in the coming months. Also, the rupee is inching closer to ₹93/$ and that also is a huge cost for Indian corporates. Any stock picking at this juncture should be tempered by such macro factors. It is best to wait out the uncertainty for now, before jumping into the fray!