Hindustan Aeronautics Ltd Set for Major Boost with New Fighter Jet Order

HAL Shares Surge Amid Major Government Order

Mumbai: Shares of Hindustan Aeronautics Ltd (HAL), a key player in the public sector defense industry, experienced a rise of 1.82% to reach Rs 4,533 during early trading on Wednesday, following news of a significant government order.

After the market opened, the stock price jumped by 3.5% to Rs 4,605, although this surge prompted a slight sell-off.

The Cabinet Committee on Security has sanctioned the purchase of 97 Light Combat Aircraft (LCA) Mark1A fighter jets, with an estimated cost of around Rs 62,000 crore.

HAL is advancing its indigenous Tejas program aimed at replacing the aging MiG-21 fleet in India. The LCA Mk1A represents an enhanced version of the Tejas, featuring upgraded combat capabilities. This new defense contract is the second substantial order for the aircraft, following a previous contract secured in February 2021.

Over the past five days, HAL shares have increased by 26.60 points, or 0.59%, and have risen by 8.72% since the beginning of the year.

In July, the stock saw a significant uptick after the Defence Acquisition Council (DAC) approved ten major procurement projects totaling Rs 1.05 lakh crore, all categorized under Buy (Indian–IDDM). This includes surface-to-air missiles, an Integrated Common Inventory Management System for the Tri-Services, an Electronic Warfare System, and armored recovery vehicles, all of which received Acceptance of Necessity (AoN) approvals.

UBS, a global brokerage firm, has kept a 'neutral' rating on HAL's stock, setting a target price of Rs 4,900.

Despite a year-on-year decline of 3.7% in net profit to Rs 1,383.8 crore, HAL reported a 10.8% increase in operational revenue, reaching Rs 4,819 crore in Q1 FY 26. EBITDA surged nearly 30% to Rs 1,284 crore, with profit margins improving to 26.7% from 22.8% the previous year, defying expectations of a downturn.