Hindustan Aeronautics shares surge 24% in nine sessions; here is why the stock is flying high

Hindustan Aeronautics shares have jumped a whopping 24% to hit a high of ₹4,209 in the last nine trading sessions. During nine sessions it has only closed lower once, data from the BSE showed.

American defence major GE Aerospace on Wednesday said it delivered the first of 99 F-404-IN20 aircraft engines to Hindustan Aeronautics Limited for the Tejas light combat jet programme.

State-run HAL is procuring the engines to power the Mk-1A variant of the Tejas jets.

In February 2021, the defence ministry sealed a ₹48,000 crore deal with Hindustan Aeronautics for the procurement of 83 Tejas MK-1A jets for the IAF.

The start of supply of the F404-IN20 engines by the American aircraft defence major is expected to help HAL start delivery of the jets to the IAF.

The F404-IN20 engine is a tailored design for India’s single-engine fighter with the highest thrust within the F404 family and a higher-flow fan, unique single-crystal turbine blades, and numerous special components, GE Aerospace said.

Following the delivery of GE Aerospace engines, global investment bank JPMorgan has maintained a positive stance on the stock.

In a note to its clients, JPMorgan said that the delayed delivery of engines was an overhang on HAL. With the delivery now starting, the overhang has been lifted.

"In our view, HAL continues to have a large opportunity set and enjoys almost a monopoly status," JPMorgan said.

Meanwhile, HAL on Thursday informed exchanges that credit ratings agency CARE Ratings has reaffirmed the CARE AAA; Stable / CARE A1+ rating for its long-term/short-term bank facilities worth ₹6,050 crore.

In the quarter ended December 2024, Hindustan Aeronautics reported a net profit of ₹1,432.60 crore, marking an increase of 14.28% from ₹1,253.51 crore logged in the same period last year.

Its revenue from operations rose 15% to ₹6,956.93 crore as against ₹6,060.91 crore registered in the year-ago period.

HAL shares have so far this year advanced 0.78%, outperforming the NIFTY50 index, which is down 0.66% year-to-date.

As of 1:32 pm, HAL shares traded 0.91% higher at ₹4,165.40 apiece, outperforming the BSE100 index, which was 0.52%.