Is HAL entering a new phase of growth with Tejas Mk-1A deliveries approaching?
Overview: Hindustan Aeronautics Limited has a Buy rating from Anand Rathi citing improving Tejas deliveries, strong order pipeline, FY27 growth guidance and 20% upside potential.
This defense stock, which is engaged in designing, manufacturing, repairing and upgrading aircraft, helicopters, aero engines, avionics and defense systems for military and civilian customers globally, is in focus after Anand Rathi gave a buy target of Rs. At 5,431, the upside potential is 19.59%.
Market capitalization is Rs. 3,05,763.93 crore shares. Hindustan Aeronautics Limited It is currently trading at Rs. It was 4,541.50 won per share, down about 1.11% from the previous day’s closing price of Rs. 4,592.05.
What is the news?
Renowned brokerage firm Anand Rathi has recommended a ‘Buy’ call on Hindustan Aeronautics Limited with a target price of Rs. At $5,431 per share, it represents an upside potential of 19.59% from the current stock price of Rs. 4,541.50.
Anand Rathi has maintained a Buy rating on Hindustan Aeronautics Ltd (HAL) as the Tejas Mk-1A program finally gets closer to delivery after more than two years of delay. The company has completed most of the weapons integration and software validation for the Astra, ASRAAM and laser-guided bombs, with only final certification pending.
HAL has already received seven GE F404-IN20 engines and expects to receive 10 more engines by November 2026, alleviating its biggest production bottleneck. Around 20 Tejas Mk-1A aircraft have already been built and flight tested, with delivery of the first 16-18 aircraft targeted by March 2027.
HAL’s long-term growth prospects remain strong, driven by robust order book of Rs 2.55 lakh crore. Management expects new order inflows of around Rs 9,000 crore, including Repair and Overhaul (ROH) contracts, during FY27-FY28, providing strong revenue visibility. Additional opportunities in the HTT-40 trainer and Su-30 upgrade programs further strengthen the growth pipeline.
Management has targeted revenue growth of 10-12% and EBITDA margin of 30-31% for FY27. With improved execution, stronger engine supply and healthy order pipeline, Anand Rathi believes HAL is well-positioned for revenue growth and maintained a Buy rating with a target price of Rs 5,431.
Order details
Hindustan Aeronautics Limited (HAL) continues to strengthen its long-term growth prospects with a robust order book of Rs. 2.55 lakh crore compared to Rs. $18.9 billion a year ago. This happens despite doing business worth Rs. 3,179.2 billion dollars per year. The strong order book provides the company with good revenue visibility over the next few years and reflects steady demand from the Indian defense sector.
During the year, HAL received new orders worth Rs. 97,028 crore including Rs. The manufacturing contract size is $6,966.8 billion, worth Rs. Repair and Overhaul (ROH) orders amount to $2653.9 billion. The major contracts included 97 LCA Mk-1A fighter jets, six ALH Mk III helicopters, eight Do-228 aircraft, 10 ALH Dhruv NG helicopters and two Hindustan-228 aircraft.
order pipeline
Looking ahead, the company expects additional orders for 143 ALH helicopters, the Su-30 upgrade program, and 40 Do-228 upgrades. HAL expects to secure approximately Rs. Supports continued business growth with $90,000 billion in new orders, including ROH contracts, over the next two years.
Company Overview
Hindustan Aeronautics Limited (HAL) is India’s leading aerospace and defense manufacturer and one of the country’s largest state-owned industrial companies. Headquartered in Bengaluru, the company designs, develops, manufactures, upgrades and maintains military aircraft, helicopters, engines, avionics and related aerospace systems for the Indian Armed Forces and other customers.
Recent Quarterly Performance
On the financial front, Hindustan Aeronautics Limited’s revenue increased from Rs. It grew by 1.77% from Rs 13,700 billion in the fourth quarter of FY 2025 to Rs 1,394.2 billion in the fourth quarter of FY 2026. Net profit also increased by 5.51% to 100 million won. Rs 397.7 billion in the fourth quarter of FY25 and Rs 419.6 billion in the fourth quarter of FY26. Hindustan Aeronautics Limited’s revenue and net profit have grown at a CAGR of 8% and 23%, respectively, over the past five years.
Based on rate of return, the company’s ROCE and ROE are 32% and 24%, respectively. Hindustan Aeronautics Limited’s earnings per share (EPS) is Rs. 136, and is a debt-free company.
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