Hindustan Aeronautics Ltd(HAL) is engaged in the business of manufacturing Aircraft and Helicopters and Repair and maintenance of Aircraft and Helicopters.
Hindustan Aeronautics Ltd shares have gained 35 percent in the last month and 99 percent in a year. The company has a market capitalization of Rs 1,81,545 crores. Today’s surge has also taken HAL’s market capitalization past the Rs 1.75 lakh crore mark, currently nearing Rs 1.8 lakh crore.
On Wednesday’s trade, the company shares reached a 52-week high price of Rs 2,753.9 per share, This was the ninth straight day of gains for this leading defense equipment manufacturer.
On Thursday, The company shares were trading at Rs 2,678 per share, down 1.38 percent from the previous closing price.
Reflecting on orders and collaboration, the stock has moved significantly over the previous few days. Here are the reasons,
● India’s defense ministry has cleared acquisition proposals worth ₹2.23 lakh crore for the armed forces, including 97 additional light combat aircraft and 156 light combat helicopters from Hindustan Aeronautics Ltd (HAL), and indigenous towed artillery gun systems for this HAL bagged order value of Rs 65,000 crore.
● The Defence Acquisition Council has approved the purchase of light combat aircraft Mk 1A for IAF from HAL. Besides, HAL was involved in the upgrade of the Su-30 MKI Aircraft.
● Recently, HAL and Airbus have signed a contract for establishing MRO facilities for the A-320 family of aircraft. This collaboration strengthens the Make-in-India Mission by achieving self-reliance in Aircraft Maintenance. Repair and Overhaul (MRO) industry in India.
● The partnership with Airbus is to support the growing demand for MRD services in the country and to expand the commercial fleet. especially the A320 family of aircraft.
● The company has signed a Memorandum of Understanding (MoU) with Safran Aircraft Engines to develop industrial cooperation in Ring forging manufacturing for commercial engines.
● The company’s order book as of May 2023 was Rs 81,784 crore. At the moment, the expected order book exceeds Rs 1 lakh crore.
● The company reported strong revenue growth by 44 percent of Rs 3,915 crore in Q2FY24 from Rs 5,635 crore, while during the same time frame, net profit increased by 52 percent from Rs 1,232 crore to Rs 810 crore.
● Increase in Indian defense capex growth, India’s FY2024 defence capital outlay budget stood at Rs 1.7 trillion. The budget has grown at a 9.4 percent CAGR over FY2017-2024E.
● Demand for indigenous manufacturing from the Ministry of Defence.
The company’s revenues have increased by 9.5 percent year on year from Rs 5,144 crore in Q2FY23 to Rs 5,635 crore in Q2FY24, while net profit has marginally increased in the same period, from Rs 1,218 crore to Rs 1,232 crore.
In the recent shareholding pattern, Foreign Institutional Investors’ holding has increased from 11.9 percent to 12.63 percent, while domestic Institutional investors hold a 9.72 percent stake in the company.
Written by Omkar Chitnis
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