Synopsis:
HAL received a Rs. 62,000 crore order for 97 LCA Mark 1A fighter jets, strengthening its order book and boosting India’s indigenous defense manufacturing.
The shares of India’s leading aircraft and helicopter manufacturer are in the spotlight after securing one of its largest defence orders worth Rs. 62,000 crore, approved by the Cabinet Committee on Security.
With the market capitalization of Rs. 3,00,608 crore, the shares of Hindustan Aeronautics Limited (HAL) is trading at Rs. 4,498 up by 1.03 percent from its previous day’s close price of Rs. 4,452.60 per equity share, and it has reached an intraday high of Rs. 4611.6.
What’s the News?
Hindustan Aeronautics Ltd (HAL) received one of its largest defence orders as the Cabinet Committee on Security approved the purchase of 97 LCA Mark 1A fighter jets. The Rs. 62,000 crore deal strengthens HAL’s order book and boosts India’s indigenous defence manufacturing capabilities.
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About the Company & Others
Hindustan Aeronautics Limited (HAL), founded in 1963 and granted Navratna status in 2007, is India’s leading aerospace and defense company, specializing in the design, development, manufacture, repair, and servicing of aircraft, helicopters, aero engines, avionics, and related systems.
With five complexes, 20 production divisions, and ten R&D centers across India, as well as 12 joint ventures and two subsidiaries, HAL has produced 17 aircraft from in-house designs and 14 under license.
As of FY25, HAL has an order book of Rs. 1,89,300 crore that improved drastically as compared to the order book of Rs. 94,127 crore as on 1st April, 2024, with new orders worth Rs. 1.25 Lakh Crores being received.
Currently, it manufactures Light Combat Aircraft (LCA), Tejas, Dornier Do228, ALH Dhruv, LCH, LUH, Su-30 MKI, Hawk AJT, and Chetak/Cheetal helicopters, with future projects including the HTT-40 trainer, naval utility helicopter, advanced LCA variants, and the Combat Air Teaming System (CATS).
A return on equity (ROE) of about 26.1 percent and a return on capital employed (ROCE) of about 33.9 percent demonstrate the company’s financial position. At the moment, the company’s P/E ratio is 36.2x as compared to its industry P/E 66.4x.
For Q1 FY26, its revenue from operations grew by 10.83 percent from Rs. 4,348 crore in Q1 FY25 to Rs. 4,819 crore in Q1 FY26, however net profits decreased by 3.69 percent from Rs. 1,437 crore in Q1 FY25 compared to 1,384 crore in Q1 FY26.
Written by Akshay Sanghavi
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