Goldman Sachs Bullish on Azad Engineering: Precision Machining, Export Traction in Focus

Azad Engineering is well-positioned to capitalise on the ongoing China+1 supply chain shift, according to a recent note by Goldman Sachs, which highlighted the company as a key beneficiary of global aerospace manufacturers diversifying their sourcing strategies. As original equipment manufacturers (OEMs) reassess supply chains in the post-pandemic environment, India is increasingly emerging as a credible alternative to China.

Goldman Sachs noted that sourcing from Western markets has become significantly more expensive since COVID-19, with cost structures rising by an estimated 45–50%. This sharp escalation has accelerated efforts by global aerospace and defence players to de-risk supply chains and build alternative manufacturing bases. Against this backdrop, India’s cost competitiveness, deep engineering talent pool and established build-to-print capabilities position it favourably in the global realignment.

The broking pointed out that global engine suppliers currently enjoy order book visibility extending through 2035, reflecting sustained long-term demand in aerospace. To meet this pipeline, OEMs are expanding and strengthening supplier ecosystems outside traditional hubs. India’s growing integration into these supply chains is viewed as a structural shift rather than a short-term tactical adjustment.

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Within this evolving landscape, Azad Engineering stands out for its expertise in complex component machining—an area Goldman described as one of the most sought-after capabilities in aerospace manufacturing. As OEMs deepen engagement with Indian suppliers, companies demonstrating high-precision engineering and advanced materials capability are expected to see stronger order inflows and export momentum.

Goldman Sachs reiterated its ‘Buy’ rating on Azad Engineering and maintained a positive stance on private-sector defence and aerospace suppliers exposed to advanced subsystems and materials. The broking underscored that the opportunity extends beyond the China+1 narrative, citing India’s broader push for Atmanirbharta (self-reliance) in defence manufacturing.

The firm estimates a domestic opportunity of around $120 billion for private-sector defence players as procurement and localisation accelerate. For Azad Engineering, the convergence of global supply chain diversification, long-cycle aerospace demand visibility and India’s advanced manufacturing ambitions suggests a structural growth runway in the years ahead.

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