Shares of Hindustan Aeronautics Limited (HAL) soared on Tuesday following a significant contract win from the Ministry of Defence, valued at an impressive ₹62,700 crore. This agreement entails the provision of 156 Light Combat Helicopters (LCH) Prachand to bolster the capabilities of both the Indian Army and the Indian Air Force. As a result, HAL’s stock price surged by 6%, reaching an intra-day peak of ₹4,444.95 on the National Stock Exchange, with a slight adjustment showing a 3% increase later in the day.
Major Contract Win for HAL
This contract marks the largest procurement deal ever secured by the Ministry of Defence from HAL. The company announced in an exchange filing, “We are pleased to inform that the Ministry of Defence has signed two agreements with us today for delivering 156 Light Combat Helicopters, comprising 90 units for the Indian Army and 66 units for the Indian Air Force, along with necessary training and support equipment, totaling approximately ₹62,700 crore, excluding taxes.”
Impressive Financial Performance
In the financial year 2025, HAL reported revenues of ₹30,400 crore, slightly up from ₹30,381 crore in the previous year, although these figures are provisional and unaudited. Dr. D K Sunil, the Chairman and Managing Director of HAL, noted, “This success came despite challenges in the delivery of the Light Combat Aircraft (LCA) and Advanced Light Helicopter (ALH). The LCA’s delivery faced delays due to engine supply issues, while the ALH production was impacted following an accident in January 2025.”
Robust Order Book
HAL’s order backlog has reached an impressive ₹1.84 lakh crore, a significant increase from the ₹94,129 crore at the start of FY25. The company secured new manufacturing contracts worth ₹1.02 lakh crore and ₹17,500 crore in Repair, Overhaul, and Maintenance (ROH) contracts for the financial year.
Analyst Recommendations
UBS has designated HAL as its top pick in the defense sector, assigning a ‘Buy’ rating and elevating the target price to ₹5,440, reflecting a 13.3% upside from its previous forecast of ₹4,800. The research note expressed, “The initiation of engine deliveries by GE, coupled with a faster schedule, should resolve execution hurdles. Additionally, the swift awarding of the LCH Prachand contract should alleviate concerns regarding declining defense expenditure.”
Future Outlook
HAL is focused on enhancing its delivery and execution capabilities, which are expected to drive profitability. The timeline for the Tejas fighter jet has been adjusted, with an increase in expected deliveries from 4 in FY26 to 7 and from 6 in FY27 to 14. This adjustment could potentially boost revenue by 3% in FY26, along with a similar rise in earnings.
Q3 Financial Highlights
In its latest quarterly results, HAL reported a net profit of ₹1,432.60 crore for Q3 of the current financial year—a 14.28% increase year-on-year, compared to ₹1,253.51 crore in the same quarter last year. The revenue from operations rose by 15% year-on-year, totaling ₹6,956.93 crore.
This contract and financial update positions HAL favorably in the defense sector, promising a bright outlook as it continues to meet the needs of India’s military forces.
