On Friday, the share price of Hindustan Aeronautics Limited (HAL) experienced a notable surge, climbing over 2% amid a wave of enthusiastic buying. The stock reached a peak of ₹4,120 on the Bombay Stock Exchange (BSE), buoyed by optimistic coverage initiated by Motilal Oswal Financial Services (MOFSL). This brokerage firm has set a price target of ₹5,100 per share, reflecting an anticipated upside of more than 26% from its previous closing.
Strong Market Position of HAL
Hindustan Aeronautics Ltd is a prominent player in the defense sector, specializing in aerospace technology. As of March 31, 2025, HAL boasts an impressive order book valued at ₹1.8 lakh crore and a robust pipeline estimated at ₹6 lakh crore, expected to be awarded over the next few years. This strong positioning supports HAL’s potential for growth in the competitive defense landscape.
Key Projects Driving Growth
MOFSL highlighted that HAL is evolving from a traditional licensed manufacturer to an indigenized model, focusing on high-profile projects including:
- Tejas Mk1
- Tejas Mk1A
- Su-30 upgrade
- Dornier-25
- Light Utility Helicopter (LUH)
These ventures are projected to significantly boost HAL’s manufacturing revenue, positioning the company for a promising future.
Anticipated Future Catalysts
According to MOFSL, HAL stands to gain from a solid pipeline of projects and an increase in execution capabilities backed by substantial platform orders. The firm forecasts a 29% revenue CAGR, 33% EBITDA CAGR, and 29% PAT CAGR from FY25 to FY27. The near-term growth could be catalyzed by the resumption of aircraft deliveries, particularly as engine supplies from General Electric (GE) become available again.
HAL Share Price Performance
In the last month, HAL shares have surged by 18%, although they have seen a slight decline of 2% year-to-date. Over the past year, the stock has appreciated nearly 15%. In terms of long-term performance, HAL has delivered impressive returns, with its stock price soaring by 190% over the last two years and an astonishing 1,400% increase in the past five years. As of 10:15 AM, HAL shares were trading 1.88% higher at ₹4,107 per share on the BSE.
In conclusion, with a robust order pipeline and strategic projects in the pipeline, HAL is well-positioned for future growth, making it an attractive option for investors looking to capitalize on the expanding defense sector.
