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Ventum Capital Markets analyst Rob Goff said in a Feb. 17 note that Canada’s forthcoming Industrial Policy Framework should formalize a structural shift toward defense sovereignty, domestic industrial capacity and NATO-aligned capability expansion.

While much of the spending has already been telegraphed through prior budget commitments, Goff said the importance lies in codifying a “build-partner-buy” strategy that prioritizes domestic champions and institutionalizes a long-duration capital cycle across procurement, training and simulation, ISR, border security, satellite infrastructure and advanced manufacturing.

“The key takeaway is confirmation,” Goff said, adding that the framework reinforces structural tailwinds already embedded in select Canadian platforms rather than creating a short-term headline trade.

The 2025 Fall Budget allocated $81.8-billion to defense over five years, including $6.6-billion for a Defence Industrial Strategy. By 2035, defense spending is budgeted at 5% of GDP, implying roughly $180-billion in procurement, $290-billion in defense-related infrastructure and $125-billion in downstream economic activity.

The government is targeting 70% of defense-related acquisitions to Canadian companies within 10 years and aims to increase SME defense revenues by more than $5.1-billion annually. A list of domestic “defense champions” is expected before summer.

Against this backdrop, Goff highlighted several publicly traded beneficiaries across the value chain.

On Calian Group (Calian Group Stock Quote, Chart, News, Analysts, Financials TSX:CGY), rated “Buy” with an $84.00 target, Goff said the company is “exceptionally well-positioned” given its domestic manufacturing, satellite and training capabilities, along with health services exposure tied to military enrollment. The $84.00 target reflects 8.4x/7.6x 2027/28 EV/EBITDA, below military-levered peers trading in the low-teens multiples.

On Exchange Income (Exchange Income Stock Quote, Chart, News, Analysts, Financials TSX:EIF), rated “Buy” with a $110.00 target, Goff pointed to embedded exposure through Arctic aviation and ISR capabilities via PAL Aerospace. He views EIF as a “structurally advantaged compounder,” trading at 8.6x/7.7x 2026/27 EV/EBITDA despite growing sovereignty-linked demand.

On Volatus Aerospace  (Volatus Aerospace Stock Quote, Chart, News, Analysts, Financials TSXV:FLT), rated “Buy” with a $0.80 target, Goff cited leverage to ISR, drone and border security priorities, supported by Mirabel-based manufacturing and proprietary drone IP. He believes the company’s $150–200-million annual revenue potential at Mirabel is underappreciated and notes more than $300-million in outstanding NATO-related RFP exposure.

Finally, on 5N Plus (5N Plus Stock Quote, Chart, News, Analysts, Financials TSX:VNP), rated “Buy” with a $30.00 target, Goff described the company as a second-order beneficiary operating at the critical materials layer of defense and satellite supply chains. Recent U.S. Defense Production Act funding reinforces its strategic positioning in ultra-high-purity compounds used in space and defense applications.

In Goff’s view, the framework does not introduce new risk or near-term volatility but rather institutionalizes a multi-year defense investment cycle, strengthening the investment case for domestically anchored platforms across services, ISR, aviation and advanced materials.

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