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Mint
15-05-2025
- Business
- Mint
Hindustan Aeronautics: Here's all you need to know before investing
Few companies in India have garnered as significant an impact in the aerospace and defence sectors as Hindustan Aeronautics Ltd (HAL). The state-owned giant has been instrumental in shaping the future of India's aerospace and defence capabilities. With decades of expertise, HAL has grown beyond being a mere supplier of military aircraft to becoming a strategic enabler of national defence, advancing the country's aspirations of self-reliance under initiatives like Make in India. From manufacturing state-of-the-art aircraft to developing cutting-edge drones, HAL's journey is a testament to its resilience, innovation, and vision for the future. The company's financial trajectory, bolstered by a substantial order book and strong government backing, signals strong growth prospects, making it a worthy stock to watch. Here's everything you need to know before investing in HAL. About the company Hindustan Aeronautics (HAL) is one of the largest and most renowned aircraft manufacturing companies in India. With a history spanning over seven decades, HAL has been instrumental in the design, development, and production of various aircraft, helicopters, and aero engines. The company's notable achievements include the production of indigenous aircraft like the Tejas Light Combat Aircraft (LCA) and the Advanced Light Helicopter (ALH). HAL's expertise extends to aircraft upgrades, overhaul services, and the manufacture of aero structures, avionics, and other critical components. It has 20 production and overhaul divisions and 9 R&D centres across India. The company inaugurated a new design and test facility at Aero Engine Research & Development Centre in Bangalore in December 2023, to accelerate R&D of aeroengines. HAL has historically been one of the PSUs with largest allocation to R&D costs. The company spends around 8% of the total revenue on R&D. Also, it has created an R&D reserve. An annual contribution of 15% of the operating profit, is transferred into this reserve. HAL's Giant Leap The company's role in India's defence sector is evolving, thanks to strategic initiatives like the Make in India program. This initiative has allowed HAL to step up its innovation game, resulting in enhanced revenue visibility and an increased appetite for taking on capital-intensive projects. HAL's massive order book continues to expand, with major inflows expected in the near future. The company's aggressive push into export markets has also contributed to its growth. With platforms like the LCA Tejas gaining international recognition, HAL is steadily enhancing its export portfolio, positioning itself as a key player on the global defence stage. Notably, HAL has been awarded the largest proposal approval in its history—a project worth ₹70,500 crore for the construction of 60 marine utility helicopters, with an estimated cost of ₹32,000 crore. What makes HAL particularly interesting for investors is its exposure to the growing drone market. The company is at the forefront of developing AI-driven, advanced drones for high-altitude strategic missions. Its emphasis on reducing foreign dependency for such technology aligns with the government's self-reliance goals. Order Book Strength HAL's order book is a key pillar of its growth story. The company's net profit has grown at a CAGR of 26% in the last three years supported by its healthy growth of order book and timely execution. At the end of FY25, its order book stood at a little over ₹1.2 trillion. This is up from ₹94,000 crore as of FY24 and ₹82,000 crore in FY22. In recent times, HAL has received substantial contracts for repair and overhaul services. A landmark contract awarded to HAL by the ministry of defence was in September 2024, for the supply of 240 aero-engines for the Su-30 MKI aircraft, worth ₹26,000 crore. This growing order book provides HAL with visibility for future revenue streams, making it a solid investment proposition. Moreover, HAL is expected to secure additional major contracts over the next few years, with the total order inflows expected to range between ₹1.6 trillion to ₹1.7 trillion over the next 18 months to three years. The management expects full workload until 2032 and expects to maintain double-digit growth in sales. It has also planned ₹14,500 crore capex over five years for capacity expansion and modernisation. HAL is poised for significant order inflows, with ₹1.3 trillion worth of contracts for 97 LCA Tejas Mark 1A and 156 LCH Prachand at an advanced stage of clearance, expected to materialise within the next three to six months. Nevertheless, investors should note that the company has received some criticism due to the delay in delivery of the fighter jets. The typical execution period for the order book extends to a few years, which could further stretch due to time taken to build capabilities. As such, the risk of overruns cannot be ruled out, impacting margins. Financial Performance HAL's financial performance has been robust. Its sales have been growing smoothly. During 2020-24, the sales and net profit have grown at a CAGR of 9.6% and 26%, respectively. The returns have been admirable, reporting an average RoCE and RoE of 30% and 26%, respectively. Due to its large scale and healthy operating profitability, the company's debt coverage metrics remain strong. As a result, its liquidity position is strong, as evidenced by its cash balance of ₹26,400 crore. Given the volatile geopolitical scenario, defence companies like HAL will remain instrumental in India's manufacturing ecosystem and will play a crucial role in helping India become part of global defence supply chain. Stock Performance Over 5 Years HAL has seen its stock price surge significantly in recent years, delivering impressive returns to investors. Over the past one year, HAL's stock has moved up 16% while in the past 5 years it has surged 1,700%, fuelled by increasing investor confidence in the company's growth prospects. What next? The future of HAL is intrinsically tied to India's defence spending, which continues to grow as the government focuses on modernizing the armed forces and strengthening self-reliance in defence technology. HAL is well-positioned to capture a significant share of this increasing budget, particularly as the country looks to reduce reliance on foreign defence suppliers. HAL's drone initiatives are a key area of growth. The company is developing the CATS Warrior, an AI-driven unmanned combat aerial vehicle (UCAV) that will work alongside manned fighter jets. It's also developing the CATS Hunter, a companion system for unmanned and manned aircraft. The company has set its sights on the launch of the CATS Warrior II, an advanced drone with 10+ hours of endurance and a payload of 400–500 kg, set for production by 2027. In addition to drones, HAL's focus on advanced avionics, AI-driven systems, and the production of strategic aircraft and helicopters further strengthens its growth potential. With an expected capex investment of ₹3,000 crore per year until FY30, HAL's roadmap for the coming years is clear—continued growth, innovation, and deeper integration with India's defence ecosystem. Conclusion HAL's story is one of steady evolution, transforming from a traditional defence manufacturer into a modern aerospace and defence giant. As the company continues to innovate and execute, it could remain an attractive option for long-term investors looking to capitalize on India's defence and aerospace growth. However, HAL could face some surprise challenges along the way. Dealing with the government, its primary client, can be arduous due to high receivable days and orders that are heavily reliant on defence budget allocations. Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions. Happy Investing. Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. This article is syndicated from
Economic Times
05-05-2025
- Politics
- Economic Times
Pakistan fires second missile in two days amid India-Pak tensions after Kashmir terrorist attack
Amid escalating tensions with India following the Kashmir attack on April 22, Pakistan's military conducted its second missile test in two days, as reported by AFP. The recent launch aimed to ensure troop readiness and validate the missile's navigation system and accuracy. This surface-to-surface missile possesses a range of 120 kilometers. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Pakistan's military said on Monday that it has carried out another missile test, its second in two days, following a sharp rise in tensions with India following the fatal terrorist attack in Kashmir on April 22 that India has linked to Islamabad."The launch was aimed at ensuring the operational readiness of troops and validating key technical parameters, including the missile's advanced navigation system and enhanced accuracy," the military said in a statement, AFP reported. The military said the surface-to-surface missile had a range of 120 kilometres (75 miles).After second missile test, Pakistan's Prime Minister Shehbaz Sharif said defence is 'in strong hands' Pakistan's military had on May 3 said it had carried out a training launch of a surface-to-surface missile. The military said the Abdali Weapon System — a missile with a range of 450 kilometres — was successfully sees Pakistan's launch of a ballistic missile on May 3 as a 'blatant' act of 'provocation', PTI had reported citing people familiar with the India has also been testing its defence newest indigenous warship, INS Surat, successfully intercepted a fast, low-flying target using a Medium-Range Surface-to-Air Missile (MRSAM) system in the Arabian Sea in April. India has also brought its Advanced Light Helicopter (ALH) fleet back into action after grounding it in January to check for possible technical faults. The move comes as tensions rise along the border, with large-scale military activity seen across the Line of Control (LoC).Several major world powers, including the United States and the European Union, have urged both India and Pakistan to ease tensions, while strongly condemning the terrorist and Pakistan have both made major upgrades to their military power since their last clash in 2019, increasing the chances of escalation even if a conflict starts off on a small scale, former army officers and defence experts told say neither country is likely to use nuclear weapons unless they are pushed to the extreme. However, even a limited military exchange carries serious risks of things getting out of two neighbours have fought three wars — in 1948, 1965 and 1971 — and have had many smaller clashes since independence, mostly over Kashmir. Both countries became nuclear powers in the 1990s, and Kashmir remains one of the most dangerous flashpoints in the world.
New Indian Express
02-05-2025
- General
- New Indian Express
Army, IAF to fly Dhruv again after crash probe
BENGALURU: The Army and Air Force variants of the indigenous Advanced Light Helicopter (ALH) Dhruv have been cleared for operations, nearly four months after the entire fleet was grounded following a fatal crash in January. In an official press release issued by the HAL on Thursday, the clearance was granted based on the recommendations of the Defect Investigation (DI) Committee, which looked into the cause of the January 5 crash in Porbandar. 'A time-bound plan for the phased resumption of flying has been worked out with the users,' the release said. This clearance applies only to the Army and Air Force variants for now. The crash on January 5 involved an ALH Mark-III of the Indian Coast Guard, killing all three crew members during a training sortie. Following the incident, all 330 ALHs in service with the armed forces were grounded as a safety precaution. Investigators had found that the chopper had failed to respond to pilot inputs in its final few seconds. The root cause was identified as a fracture in the swashplate assembly, a critical part in the helicopter's transmission system. HAL officials had also suspected that a rare material failure may have led to the malfunction. Though the Army and Air Force variants have now been cleared, the advisory to civilian operators remains. HAL has asked them to keep their ALH Mark-III helicopters grounded until the investigation into the Porbandar crash is fully completed.
News18
02-05-2025
- Business
- News18
Stocks To Watch: Eternal, Marico, Adani Enterprises, HAL, Bandhan Bank, And Others
Last Updated: Stocks to watch: Shares of firms like Eternal, Marico, Adani Enterprises, HAL, Bandhan Bank, and others will be in focus on Thursday's trade Stocks To Watch On May 2: Markets remained largely flat for another session on Wednesday. In Thursday's trade, the following stocks will be in focus due to quarterly earnings announcements and key news developments: Marico, IOB: Both Marico and Indian Overseas Bank will announce their Q4 results today. Eternal: The food delivery platform reported a 77.7% YoY drop in Q4FY25 net profit to Rs 39 crore from Rs 175 crore. Sequentially, profit declined 33.8% from Rs 59 crore. Adani Enterprises: The group's flagship firm posted a more than sevenfold jump in Q4FY25 net profit to Rs 3,844.91 crore from Rs 450.58 crore, driven by exceptional gains. HAL: The Advanced Light Helicopter (ALH) Dhruv variants for the Army and Air Force have been cleared for operations based on Defect Investigation Committee recommendations. Jaiprakash Power Ventures: Reported a 73% drop in Q4 profit to Rs 155.67 crore from Rs 588.79 crore due to reduced income. Adani Ports: Posted a 47% YoY jump in net profit to Rs 3,014.22 crore for Q4FY25, beating Bloomberg's estimate of Rs 2,662.1 crore. Indus Towers: Reported a 4% YoY decline in Q4 profit to Rs 1,779 crore. However, the company noted improving industry outlook. Bandhan Bank: Reported a 482% YoY surge in net profit to Rs 317.90 crore in Q4FY25, aided by lower provisions despite a 4% drop in net interest income. Auto Stocks: Maruti Suzuki, Tata Motors, and others will be in focus post their April sales reports. NCC: Secured orders worth Rs 1,582 crore in April—Rs 1,082 crore for Building Division and Rs 500 crore for Transportation. JSW Energy: Its arm JSW Neo Energy signed a 1,500 MW/12,000 MWh Pumped Hydro Storage Power agreement with UPPCL, earning Rs 77.2 lakh/MW annually for 40 years. HBL Engineering: Received Rs 145.83 crore contract from Western Railway to implement Kavach safety system over 428 km across 48 stations. GR Infraprojects: Won Rs 4,262.78 crore DBFOT (Toll) project for Agra-Gwalior Greenfield Road spanning UP, Rajasthan, and MP. One MobiKwik Systems: Its subsidiary Zaakpay received RBI nod to operate as an online payment aggregator. Bank of India: Approved capital raising of up to Rs 5,000 crore in FY26 via Tier-I and Tier-II bonds. Transferred Rs 329.45 crore to SBI as share capital. Disclaimer:Disclaimer: The views and investment tips by experts in this report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions. First Published: May 02, 2025, 08:25 IST
Economic Times
02-05-2025
- Business
- Economic Times
HAL shares in focus after Army, Air Force versions of ALH Dhruv helicopters cleared for operations
Hindustan Aeronautics Ltd (HAL) shares are in focus as Army and Air Force variants of ALH Dhruv helicopters, previously grounded, have been cleared for operations following a Defect Investigation Committee's recommendations. This clearance follows the grounding of the entire fleet after a Coast Guard incident in January. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Popular in Markets HAL Q3 Earnings HAL Shares Target Price Shares of Hindustan Aeronautics Ltd HAL ) will be in focus on Friday after the Army and Air Force variants of the ALH Dhruv helicopters , grounded since January, were cleared for which manufactures the Dhruv helicopters, said on Thursday that the clearance came following recommendations from a Defect Investigation (DI) Committee. 'It is now intimated that the Advanced Light Helicopter (ALH) Dhruv Army and Air Force versions are cleared for operations,' the defence PSU said in a statement.A time-bound plan has also been drawn up with the armed forces to resume entire fleet of 330 ALHs was grounded after an Indian Coast Guard ALH Mark-III crashed during a training sortie in Porbandar on January 5, killing all three crew members. Following the incident, HAL had also advised civilian operators to suspend operations until the cause was ALH Dhruv is an indigenously designed, twin-engine, multi-role helicopter in the 5.5-tonne category. HAL has produced over 340 units so in April, HAL signed a Rs 62,700 crore contract with the Ministry of Defence to supply 156 Light Combat Helicopters (LCH) Prachand to the Army and Air Force. Cleared by the Cabinet Committee on Security, it marks India's largest-ever defence procurement The Prachand is the only attack helicopter capable of operating at altitudes from 5,000 to 16,400 feet, making it suitable for high-altitude missions in areas such as Siachen and Eastern Ladakh. It can fire both air-to-air and air-to-ground missiles and is integrated with network-centric operation systems for enhanced battlefield the quarter ending December 2024, HAL reported a net profit of Rs 1,432.60 crore, a 14.28% increase compared to Rs 1,253.51 crore in the same period last year. The company's revenue from operations also saw a 15% rise, reaching Rs 6,956.93 per Trendlyne data, the average target price of the stock is Rs 4,891, which shows an upside of 9% from the current market prices. The consensus recommendation from 17 analysts for the stock is a 'Strong Buy'.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
