Hindustan Aeronautics Limited shares surged over 3% in Thursday’s session, driven by renewed optimism around its collaboration with GE Aerospace and continued bullish commentary from Citi.
The rally follows a key development in HAL’s long-standing defence partnership with GE Aerospace, where both companies have reached an agreement on critical technical aspects for the co-production of F414 jet engines in India. This marks a significant milestone since the original memorandum of understanding (MoU) was signed in 2023, strengthening India’s push for indigenous defence manufacturing.
Citi has reiterated its positive stance on HAL, maintaining a “Buy” rating with a target price of ₹5,560. The brokerage believes the agreement enhances HAL’s long-term growth visibility, especially as India accelerates its defence modernization and domestic production capabilities.
The F414 engines are expected to play a crucial role in powering the upcoming Tejas Mk2, which could see production of over 100 aircraft. In addition, the engines are likely to be deployed in the first two squadrons of the AMCA Mk1, India’s next-generation stealth fighter program.
While technical alignment has now been achieved, the next phase involves commercial negotiations between HAL and GE Aerospace. These discussions are expected to conclude between December 2026 and March 2027. Investors will closely track timelines, cost structures, and execution risks before full-scale implementation begins.
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