The global aerospace sector is poised for significant expansion over the next two decades, driven by rising air travel demand and the need to replace ageing fleets. According to the Airbus Global Market Forecast (GMF) 2025-44, the world’s passenger and freighter aircraft fleet is expected to nearly double from 24,730 aircraft at the end of 2024 to 49,210 aircraft by 2044.
This growth will require a total of 43,420 new aircraft, dominated by single-aisle planes catering to domestic and regional travel, and widebody aircraft connecting major international hubs while supporting high-traffic regional routes in Asia.
A key component of this growth is fleet modernisation, with roughly 18,930 aircraft deliveries expected to replace older-generation models. These upgrades are essential not only for operational efficiency but also for significantly reducing aviation’s environmental footprint per passenger kilometre.
This massive expansion translates into a growing demand for precision-engineered components, making specialised suppliers a critical link in the global aerospace supply chain.
About The Company
Azad Engineering Ltd. (AEL), with a market capitalization of Rs. 10,809.05 crore, opened at Rs. 1,670.75, reaching a high of Rs. 1,679.50 against the previous close of Rs. 1,669.50, marking an intraday rise of 0.59 percent.
Incorporated by Rakesh Chopdar in 1983, AEL is a leading manufacturer of precision-forged and machined components for clean energy, aerospace, defence, oil and gas, and standalone power supply (SPS) segments.
The company operates a state-of-the-art facility in Hyderabad, equipped with a Forge Shop, Heat Treatment Shop, advanced CNC machines, heavy machining capabilities, inspection labs, and specialised manufacturing software.
Over the years, it has earned multiple international certifications, including National Aerospace and Defense Contractors Accreditation Program (NADCAP), ISO 9001:2015, AS9100 D, ISO 14001:2015 (EMS), BS 45001:2018 (OHSAS), and ISO 27001:2013 (ISMS). Recently, it was also certified to supply components for nuclear turbines by EDF, France. AEL maintains a robust order book of Rs. 60 billion.
Revenue Mix
In Q1FY26, the Energy and Oil & Gas segment contributed 81.2 percent to total sales, up from 78.4 percent in Q1FY25, primarily due to the commissioning of additional capacity. Aerospace and Defence accounted for 17.1 percent, slightly down from 18.5 percent in the previous year, reflecting the gradual ramp-up of newly qualified products entering production.
Other operating segments contributed 1.7 percent compared to 3.1 percent in Q1FY25. Export sales remained dominant at 92 percent, up from 90.5 percent, while domestic sales accounted for 8 percent, down from 9.5 percent.
Recent Key Order Wins in Aerospace
AEL has secured several strategic contracts reinforcing its leadership in high-precision aerospace components. The company won a prestigious national contract from GTRE, a DRDO-affiliated organisation, for end-to-end manufacturing, assembly, and integration of a complete Advanced Turbo Gas Generator Engine.
Additionally, it received a Phase 1 business award from Honeywell Aerospace ISC, USA, valued at USD 16 million over the contract period, to manufacture and supply high-complexity components.
AEL also signed a long-term agreement with Rolls-Royce Plc, London, to produce civil aircraft engine components and supply supercritical machined parts throughout the life of the engine program.
Products
AEL manufactures medium to highly complex precision components and assemblies crucial for both civil and military platforms. Its portfolio includes airfoils and blades for aircraft engines and APUs, body valves, housings, compressor mounts, fan blisks, mixed flow impellers, turbine wheels, unison rings, hydraulic and flight control systems, actuating systems, and other critical parts. Components are produced using investment castings, forgings, bar stock, tubes, and plates, and undergo stringent machining, thermal spray coatings, and testing.
The company has developed specialised capabilities for aerospace-standard fluid distribution systems spanning entire aircraft hydraulic networks. Materials used include steel, aluminium, titanium, super/exotic alloys, and aircraft-grade copper alloys, ensuring performance in extreme aerospace environments. All parts are rigorously tested and certified by organisations such as NABL and the Performance Review Institute, guaranteeing conformity to global aerospace standards.
Clients
AEL is a critical supplier to OEMs with extensive global penetration. It serves six major aerospace and defence manufacturers and supplies components for aircraft platforms such as A320, A350, A355, A350 XWB, B737, B737 Max, B747, B777, B777X, and Gulfstream G550.
Discussions are ongoing for supplying components for new engine platforms. In the turbine segment, AEL works with five leading manufacturers controlling approximately 75 percent of the market.
According to a report from CARE Ratings, its aerospace clientele includes Honeywell, GE Aviation, Eaton, Boeing, Rolls Royce, Baker Hughes, Pratt & Whitney, Rafael, and HAL. The company’s export footprint spans the US, UK, Europe, Japan, and the Middle East.
Over the past decade, AEL achieved over 1,700 product qualifications and 45 process qualifications, providing a substantial competitive edge alongside only three other major global players.
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Manufacturing Facilities
AEL’s operational facilities include four existing units in Hyderabad covering 20,000 sq. metres and serving multiple customers. The company is expanding with multiple sub-facilities, including Phase 1 (94,899 sq. metres, of which two facilities are already inaugurated) and Phase 2 (67,267 sq. metres), dedicated to specific customer requirements.
Financial Snapshot
Quarter-on-quarter, sales rose from Rs. 127 crore to Rs. 137 crore, an increase of 7.87 percent. Operating profit grew from Rs. 46 crore to Rs. 49 crore, an increase of 6.52 percent, PBT climbed from Rs. 36 crore to Rs. 42 crore, an increase of 16.67 percent, and net profit surged from Rs. 25 crore to Rs. 29 crore, an increase of 16 percent.
Year-on-year, sales expanded from Rs. 98 crore to Rs. 137 crore, a 39.8 percent rise. Operating profit increased from Rs. 33 crore to Rs. 49 crore, an increase of 48.5 percent. PBT jumped from Rs. 24 crore to Rs. 42 crore, an increase of 75 percent. Net profit grew from Rs. 17 crore to Rs. 29 crore, an increase of 70.6 percent.
Diplomatic Outlook
With a well-diversified global client base including Boeing, Airbus, and Rolls-Royce, AEL is strategically positioned to benefit from the projected surge in aircraft demand over the next 20 years.
Its expertise in mission-critical components, stringent certification processes, and high barriers to entry give it a strong competitive moat. The company’s growing order book, expanding manufacturing footprint, and increasing export sales signal a robust growth trajectory, making it a key player in the aerospace components sector and a potential frontrunner as the industry scales to meet future global aviation needs.
Written By Manan Gangwar
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