Synopsis: Hindustan Aeronautics Limited received a Buy rating from Anand Rathi, citing improving Tejas deliveries, a strong order pipeline, FY27 growth guidance, and 20% upside potential.
This Defence Stock, engaged in designing, manufacturing, repairing, and upgrading aircraft, helicopters, aero-engines, avionics, and defence systems for military and civilian customers globally, is in focus after Anand Rathi gave a Buy target of Rs. 5,431, which has an upside potential of 19.59 percent.
With a market capitalization of Rs. 3,05,763.93 crore, the shares of Hindustan Aeronautics Limited were currently trading at Rs. 4,541.50 per equity share, down nearly 1.11 percent from its previous day’s close price of Rs. 4,592.05.
What is the News?
Anand Rathi, a prominent brokerage firm, has recommended a “Buy” call on Hindustan Aeronautics Limited with a target price of Rs. 5,431 per share, indicating an upside potential of 19.59 percent from its current price of Rs. 4,541.50.
Anand Rathi has maintained a Buy rating on Hindustan Aeronautics Ltd (HAL) as the Tejas Mk-1A programme is finally moving closer to deliveries after more than two years of delays. The company has largely completed weapon integration and software validation for Astra, ASRAAM and laser-guided bombs, with only final certification pending.
HAL has already received 7 GE F404-IN20 engines and expects another 10 engines by November 2026, easing the biggest production bottleneck. Around 20 Tejas Mk-1A aircraft have already been manufactured and flight-tested, with deliveries of the first 16-18 aircraft targeted by March 2027.
HAL’s long-term growth outlook remains strong, supported by a robust order book of Rs 2.55 lakh crore. Management expects around Rs 900 billion of new order inflows during FY27-FY28, including repair and overhaul (ROH) contracts, providing strong revenue visibility. Additional opportunities from the HTT-40 trainer aircraft and Su-30 upgrade programme further strengthen the growth pipeline.
Management has guided for 10-12 percent revenue growth and 30-31 percent EBITDA margins in FY27. With improving execution, stronger engine supplies and a healthy order pipeline, Anand Rathi believes HAL is well positioned for earnings growth and has maintained its Buy rating with a target price of Rs 5,431.
Order Book Details
Hindustan Aeronautics Limited (HAL) continues to strengthen its long-term growth outlook with a robust order book of Rs. 2.55 lakh crore, compared to Rs. 1.89 lakh crore a year earlier. This is despite executing business worth Rs. 31,792 crore during the year. The strong order book gives the company good revenue visibility for the coming years and reflects steady demand from India’s defence sector.
During the year, HAL received fresh orders worth Rs. 97,028 crore, including Rs. 69,668 crore in manufacturing contracts and Rs. 26,539 crore in repair and overhaul (ROH) orders. Major contracts included 97 LCA Mk-1A fighter aircraft, 6 ALH Mk III helicopters, 8 Do-228 aircraft, 10 ALH Dhruv NG helicopters, and 2 Hindustan-228 aircraft.
Order Pipeline
Looking ahead, the company expects additional orders for 143 ALH helicopters, the Su-30 upgrade programme, and 40 Do-228 upgrades. HAL expects to secure around Rs. 90,000 crore in new orders, including ROH contracts, over the next two years, supporting sustained business growth.
Company Overview
Hindustan Aeronautics Limited (HAL) is India’s flagship aerospace and defence manufacturer and one of the country’s largest state-owned industrial enterprises. Headquartered in Bengaluru, it designs, develops, manufactures, upgrades, and maintains military aircraft, helicopters, engines, avionics, and related aerospace systems for the Indian armed forces and other customers.
Recent Quarter Results
Coming into financial highlights, Hindustan Aeronautics Limited’s revenue has increased from Rs. 13,700 crore in Q4 FY25 to Rs. 13,942 crore in Q4 FY26, which has grown by 1.77 percent. The net profit has also grown by 5.51 percent from Rs. 3,977 crore in Q4 FY25 to Rs. 4,196 crore in Q4 FY26. Hindustan Aeronautics Limited’s revenue and net profit have grown at a CAGR of 8 percent and 23 percent, respectively, over the last five years.
In terms of return ratios, the company’s ROCE and ROE stand at 32 percent and 24 percent, respectively. Hindustan Aeronautics Limited has an earnings per share (EPS) of Rs. 136, and it is a debt-free company.
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
