Hindustan Aeronautics Limited (HAL) reported that its H1 FY26 operating margins stood at 24.8%, significantly below the company’s full-year guidance of 31%, raising investor concerns about cost pressures and execution timelines. The decline in margins led to a sharp reaction in the stock, with shares falling nearly 3% to Rs 4,741 on the NSE during Wednesday’s session.
Despite the margin miss, HAL posted a 10.5% year-on-year rise in consolidated net profit to Rs 1,669 crore in Q2 FY26, compared to Rs 1,510 crore in the same quarter last year. However, the figure came below market expectations of around Rs 1,750 crore.
Revenue from operations grew 10.9% YoY to Rs 6,628 crore from Rs 5,976 crore, supported by steady execution of defence contracts. EBITDA, however, fell 5% to Rs 1,557 crore from Rs 1,639 crore last year, missing the street’s Rs 1,860 crore estimate. The EBITDA margin narrowed to 23.5% from 27.4%, indicating pressure from higher costs.
At its current level, the company’s market capitalization stands at Rs 3.18 lakh crore, with a P/E ratio of 38.15 and a dividend yield of 0.84%.
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