Shares of Hindustan Aeronautics Ltd. (HAL) fell 2.36% to ₹4,341 on the Bombay Stock Exchange on Tuesday, extending their one-month decline to over 10%, ahead of the defense public sector undertaking’s (PSU) June quarter results. The broader BSE Sensex slipped 2.16% over the same period, underscoring the sharper correction in HAL’s stock price.
Analysts attribute the pre-result weakness to investor caution, with market participants closely watching for updates on General Electric (GE) engine supplies and the anticipated repeat order for the Light Combat Aircraft (LCA) Mark 1A. The company’s large defense order book, estimated at ₹1.8 lakh crore, remains a key driver of its revenue outlook.
Analysts Project Strong Revenue and Profit Growth
Brokerage firm Nomura India expects Hindustan Aeronautics Ltd. (HAL) to report an adjusted net profit of ₹1,198.8 crore for the April–June quarter, marking a 16.6% year-on-year (YoY) increase from ₹1,028.4 crore in the same period last year. Revenue is forecast to rise 11% YoY to ₹4,825 crore, up from ₹4,347 crore.
Nomura’s estimates peg the company’s earnings before interest, tax, depreciation, and amortization (EBITDA) at ₹1,107 crore, with an EBITDA margin of 22.9%, up 9 basis points from the previous year. The brokerage anticipates other income to grow 18% YoY, while depreciation expenses are expected to remain stable, contributing to an estimated 17% YoY growth in profit after tax (PAT).
“We expect revenue to grow on the back of the healthy order execution pipeline,” Nomura said in its earnings preview. “EBITDA margins should remain flat YoY, supported by operational efficiency and cost controls.”
MOFSL Sees Even Higher Growth Potential
Motilal Oswal Financial Services Ltd. (MOFSL) projects a more bullish outlook, expecting Hindustan Aeronautics Ltd. (HAL) revenue to climb 21% YoY to ₹5,250 crore. The brokerage forecasts EBITDA margin expansion of 120 basis points YoY, aided by increased indigenization in manufacturing and easing of supply chain constraints.
According to MOFSL, key performance indicators to monitor include:
- Progress on Tejas Mk1A aircraft deliveries.
- Updates on the Su-30 fighter jet avionics upgrade program.
- Any significant changes in provisions made during the quarter.
- Developments in the company’s working capital cycle.
MOFSL also expects HAL’s quarterly profit to reach ₹1,260 crore, representing a 24% YoY jump. “The execution of a large backlog, incremental order inflows, and comfortable margin levels remain crucial focus areas for HAL going forward,” the brokerage noted.
Strategic Context and Market Sentiment
Hindustan Aeronautics Ltd. (HAL) performance in the coming quarters will likely depend on its ability to execute large-scale defense contracts efficiently while navigating supply chain uncertainties. The PSU’s order book includes significant projects such as fighter aircraft, helicopters, avionics systems, and repair and overhaul services, both for domestic defense forces and export markets.
Investor sentiment has been tempered in recent weeks due to broader market volatility and sector-specific concerns, but analysts maintain that HAL’s fundamentals remain strong. The anticipated repeat order for LCA Mark 1A and clarity on GE engine supplies could serve as potential catalysts for the stock.
Despite the recent correction, the company’s long-term growth trajectory is underpinned by sustained defense spending by the Indian government and the push for greater self-reliance in defense manufacturing. However, short-term stock movements may continue to be influenced by quarterly earnings performance, order flow announcements, and macroeconomic factors.
The market will be closely watching Hindustan Aeronautics Ltd. (HAL) official Q1 FY26 results announcement later today for confirmation of these projections and management commentary on the company’s strategic priorities.
