Hindustan Aeronautics shares rally over 3% on ₹62,000 crore order win; check details

The stock rallied as much as 3.42% to ₹4,605 on the NSE.

The Cabinet Committee on Security (CCS), chaired by Prime Minister Narendra Modi, has given its final approval — marking the last step before the formal signing of the deal. The jets will be built by Bengaluru-headquartered HAL, a Maharatna public sector undertaking under the Ministry of Defence.

This will mark the second order for the Mk1A fighter jets, with an earlier contract already placed with HAL for 83 aircraft at a cost of ₹36,400 crore, reports added.

HAL missed the original February 2024 deadline to start deliveries of the LCA Mk1A, primarily due to delays in the arrival of F404-IN20 engines from the American engine maker GE Aerospace. These jets are intended to replace the last of the IAF’s Russian-origin MiG-21s, which are scheduled to retire in September, said a report by Business Standard.

HAL has guaranteed the delivery of 12 Mk1A aircraft by the end of 2025-26, despite the IAF's mounting challenges. The company has already built six, which are currently flying with reserve engines — a temporary measure. The second GE engine for the Mk1A was delivered to HAL in mid-July, the report added.

The Tejas Mk1A will have advanced electronic radar, warfare and communication systems, additional combat capability and improved maintenance features. Christened Tejas in 2003, the aircraft is a multi-role platform that ranks amongst the best in its class.

It has been designed to undertake the air defence, maritime reconnaissance and strike roles. The first version of the Tejas was inducted into the IAF in 2016, and currently there are two IAF squadrons of Tejas which are fully operational, Deccan Chronicle reported.

What does this mean for HAL?

This development will be closely watched by investors and industry analysts, as it is likely to have a positive impact on HAL's financial performance and stock valuation in the coming years.

HAL Q1 FY26 Results

Hindustan Aeronautics Limited (HAL), the state-run fighter jet maker, reported a net profit of ₹1,384 crore in the first quarter of the current financial year (Q1FY26), marking a decline of 4% from ₹1,437 crore in the same period last year.

The Bengaluru-based company's revenue from operations advanced 11% to ₹4,819 crore in the April-June period from ₹4,348 crore in the year-ago period.

Hindustan Aeronautics reported strong operational performance as its operating profit, also known as earnings before interest, taxes, depreciation, and amortisation (EBITDA), jumped 30% to ₹1,282 crore from ₹990 crore in the corresponding period last year.

Its operating profit margin improved by 380 basis points to 26.61% from 22.78%.

Meanwhile, India’s annual defence production has crossed the ₹1.5 lakh crore mark for the first time, recording a sharp increase over previous years. Defence Minister Rajnath Singh described the achievement as a clear sign of the country’s strengthening defence industrial base.

The 2024–25 figure represents an 18% increase over the previous fiscal year’s ₹1.2 lakh crore and a 90% surge from ₹79,071 crore in 2019–20. Officials credited the milestone to the combined efforts of the Ministry of Defence’s Department of Defence Production, defence public sector undertakings (PSUs), other state-owned manufacturers, and private industry.