A leading aerospace and defence company known for manufacturing aircraft and defence equipment continues to strengthen its market position. In this update, a global brokerage highlights the company’s robust order pipeline and long-term growth prospects, offering insights into the latest analyst view and what investors should watch for in the coming quarters.
Hindustan Aeronautics Limited‘s stock, with a market capitalisation of Rs. 3,32,655 crores, rose to Rs. 5,049.80 hitting a high of up to 0.74 percent from its previous closing price of Rs. 5,012.60. However, the stock over the past year has given a negative return of 11.5 percent.
Target By JPMorgan
JPMorgan has set a target price of Rs. 6,105 on HAL, implying an upside potential of 22%. The firm maintains its positive outlook on the stock.
Rationale: JPMorgan maintains an ‘Overweight’ rating on Hindustan Aeronautics (HAL), citing a strong order book of Rs. 1,89,300 crore as of FY25 that ensures growth visibility. The firm highlights greater clarity on upcoming initiatives, with progress on the AMCA (Advanced Medium Combat Aircraft) tender being a critical factor to watch. Over the long term, HAL could benefit from the modernisation of India’s ageing fighter aircraft fleet.
Views on Production Capabilities: Recently, the company received the first engine for the LCA Mk1A fighter jet from GE Aerospace and expects the second one by the end of July. This marks an important step in meeting its delivery targets. JPMorgan has shared a positive outlook, highlighting that HAL has already produced six aircraft using reserve engines and will receive 12 engines in 2025, enabling the delivery of 12 jets in FY26. These developments will help HAL ramp up its production and meet the growing defence needs of the country.
The company’s long-term growth prospects look strong as it moves closer to finalising a major 80% technology transfer deal with GE Aerospace. This will allow HAL to manufacture advanced F-414 engines for the LCA Mk2 in India, strengthening its position as a self-reliant defence manufacturer. These strategic steps will likely boost HAL’s future revenue and technological capabilities.
Also read: ₹1,197 Cr Orderbook: IT stock jumps 4% after receiving ₹115 Cr order from MMRDA for infra project
Q4 Financial Highlight
In Q4FY25, the company reported revenue of Rs. 13,700 crore, down 7.3 percent YoY from Rs. 14,769 crore but up 97 percent QoQ from Rs. 6,957 crore, reflecting a sharp sequential recovery. Profit for the quarter stood at Rs. 3,977 crore, declining 7.7 percent YoY from Rs. 4,309 crore but improving significantly 176 percent QoQ from Rs. 1,440 crore, indicating a strong rebound in profitability.
Over the past three years, the company has maintained steady growth with a 3-year revenue CAGR of 8 percent, a profit CAGR of 18 percent, and an impressive ROE CAGR of 27 percent, showcasing improved operational efficiency and returns to shareholders. Despite the YoY decline, the company’s strong QoQ performance highlights a recovery in business momentum.
Written By Fazal Ul Vahab C H
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