JP Morgan has reiterated its ‘Overweight’ rating on Hindustan Aeronautics Limited (HAL) with a target price of ₹4,958, indicating a healthy upside from the current market price of ₹4,179.90. The brokerage reacted positively to HAL’s final signing of a contract with the Ministry of Defence (MoD) for the supply of Light Combat Helicopters (LCH).
The contract, valued at ₹62,700 crore (excluding taxes), includes the supply of helicopters as well as training and associated equipment, further enhancing HAL’s long-term growth outlook. While the order had been anticipated for some time, JP Morgan believes that the formal award solidifies HAL’s opportunity set and marks a key milestone in its execution trajectory.
With this latest development, HAL’s FY25 order inflow now exceeds ₹1.2 trillion, compared to ₹560 billion secured during the first nine months of the fiscal year. The company’s order book for FY25 is estimated at ₹1.9 trillion, translating into a book-to-bill ratio of approximately 5x, offering strong revenue visibility.
Despite a sharp rally in the stock over the past month, JP Morgan believes HAL still trades at reasonable valuations—33x FY26E P/E and 29x FY27E P/E, making it an attractive long-term play in the defence sector.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Please consult a qualified financial advisor before making any investment decisions.
