Shares of defence major Hindustan Aeronautics Limited declined as much as 4.3% to their day’s low of Rs 4,411 on the BSE on Friday despite reporting a consolidated net profit of Rs 4,196 crore for the quarter ended March 2026, up 6% from Rs 3,977 crore posted in the same period last year.
Revenue from operations during the March quarter increased 2% year-on-year to Rs 13,942 crore, compared with Rs 13,700 crore in the corresponding quarter of FY25. On a sequential basis, HAL’s performance improved sharply. Net profit more than doubled from Rs 1,867 crore reported in the December quarter, while revenue from operations jumped over 81% from Rs 7,699 crore in Q3FY26.
The company’s total income for the quarter rose over 5% year-on-year to Rs 15,093 crore, while total expenses climbed more than 4% to Rs 9,522 crore during the same period. For the full financial year 2026, HAL posted a net profit of Rs 9,116 crore, marking a rise of nearly 9% from Rs 8,364 crore in FY25. Annual revenue increased around 7% to Rs 33,089 crore from Rs 30,981 crore reported a year earlier.
The company’s earnings per share stood at Rs 62.57 for the March quarter, up nearly 6% year-on-year, while FY26 EPS rose more than 9% to Rs 135.71. HAL’s net worth also expanded 17% during the financial year to Rs 40,862 crore.
HAL share: Should you buy, sell or hold?
Nomura has maintained its ‘Buy’ rating on Hindustan Aeronautics with a target price of Rs 5,954, implying a potential upside of nearly 29% from current levels. The brokerage said HAL delivered a strong performance in Q4FY26, with earnings surpassing its estimates across key parameters. Nomura also highlighted the company’s robust order backlog of Rs 2.54 lakh crore and a book-to-bill ratio of 8x, which provides strong revenue visibility going forward.
Despite the recent rally in the stock, the brokerage noted that HAL is currently trading at 23x FY28 estimated EPS, below its five-year average one-year forward P/E multiple of 26x, offering an attractive risk-reward profile.
Goldman Sachs has maintained a ‘Neutral’ rating on Hindustan Aeronautics Limited while slightly lowering its target price to Rs 5,225 from the earlier Rs 5,255 (13.4% upside). The brokerage said HAL continues to maintain a robust order book, although a meaningful pickup in execution is yet to materialise.
The Wall Street major noted that EBITDA margins came in lower than expected due to higher other expenses and elevated capitalised expenses during the quarter. It also highlighted that provisions declined 88% year-on-year, which it believes points to continued subdued manufacturing activity in Q4. The brokerage added that deliveries of the Tejas Mk-1A aircraft will remain a key trigger for the stock going ahead.
JM Financial has maintained its ‘Buy’ rating on Hindustan Aeronautics Limited with a target price of Rs 4,875, implying a potential upside of around 5.5% from current levels. The brokerage, however, flagged potential risks arising from further delays in deliveries of the Tejas Mk1A aircraft.
The brokerage also highlighted deterioration in the company’s working capital position and operating cash flow during FY26. Inventory levels increased sharply year-on-year, with inventory days rising to nearly 350 days from around 250 days in FY25. Net working capital, excluding customer advances, rose to 565 days from 440 days a year ago. Even after including customer advances, working capital metrics weakened on a yearly basis. Operating cash flow also declined to Rs 10,900 crore in FY26 from Rs 13,600 crore in FY25.
The brokerage added that key downside risks include delays in manufacturing order inflows, slower approvals for major projects, rising competition from private sector players in large defence platform orders, risks from import substitution and weaker-than-expected execution in critical programmes.
HAL share performance
HAL shares have gained about 15% over the past month and around 7% so far in 2026. Over a longer horizon, the stock has delivered returns of 216% in three years and 856% over five years. The company’s market capitalisation currently stands at nearly Rs 2.98 lakh crore.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
