Hindustan Aeronautics will be supplying 6 sets of LM2500 Gas Turbines(GT) and GT Auxiliaries (GTAE), Spares, Tools for Indian Navy Next Generation Missile Vessel(NGMV) Project to Cochin Shipyard.
The order by Cochin Shipyard is to be executed by Hindustan Aeronautics (HAL) between FY26 to FY29.
Strong order book bodes well for Hindustan Aeronautics (HAL) in coming years due to very good revenue visibility, said analysts.
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“We believe that Hindustan Aeronautics (HAL) is a long-term play on the growing strength & modernization of India’s air defence as it is the primary supplier of India’s military aircraft and leap in HAL’s Technological capabilities along with robust 5 year order book pipeline of more than Rs.2 trillion ( ₹2 Lakh Crore)” said an analyst at Prabhudas Lilladher.
The analysts already have remained positive on the prospects of Hindustan Aeronautics. Hindustan Aeronautics share price too have seen sharp gains of more than 153% in last one year on rising order flows predominantly from the Defence Sector. The order in flows are expected to remain strong.
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The growing percentage of indigenization in the aircraft and helicopter industries, together with the potential for exports, has already been leading analysts to expect a re rating for the Hindustan Aeronautics stock.
The expectations on order flows already remains very strong starting FY25. The Defence Acquisition Council (DAC) granted Acceptance of Necessity (AoN) in November 2023 for the acquisition of extra units of Tejas Mk-1A light combat aircraft (LCA) and light combat helicopters (LCH; perhaps 15 nos.) from HNAL. Additionally, it authorized the Su-30 MKI fleet’s upgrade (the original plan was probably for 84 units). Analysts at Elara Securities India Pvt Ltd have been expecting these orders to be placed between FY25 and FY27.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
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Published: 01 Apr 2024, 10:45 AM IST