CLSA has reiterated its Outperform rating on Hindustan Aeronautics Ltd with a target price of Rs 5,436, stating that its deep dive into the company’s prospects points to orders of US$33 billion over FY25–30CL, even after its exclusion from India’s fifth-generation fighter development race.
The brokerage said HAL’s exclusion is limited to AMCA 1.0 and that the company will remain eligible to bid at the mass production stage. It expects repeat helicopter orders and the recently cleared Super Sukhoi programme to fully compensate for the exclusion.
HAL’s backlog rose 88 per cent year-on-year in FY25, and CLSA forecasts it to reach US$28 billion by FY27. The US$3.6 billion helicopter order has received government approval, improving visibility for recognition in FY27. CLSA said HAL has the strongest pipeline of orders in the sector, with around 14 years of backlog, making it its preferred pick.
The brokerage sees the start of Mk1A fighter deliveries in the second quarter of 2026, visibility on GE engine deliveries and the GE 414 Make in India production deal as key catalysts. It also noted that HAL is the cheapest pure-play defence stock despite its sector-leading position.
Disclaimer: The views and investment tips expressed above are those of the brokerage and do not represent the views of this publication. This article is for informational purposes only and does not constitute investment advice.