HAL gains for 4th day in a row; closes at a record high

HAL (Hindustan Aeronautics Limited) stock soared to a new 52-week high on Wednesday, November 16, extending its advances for a fourth straight day.

The stock has increased by more than 10% in the past four trading sessions. During intraday trade on November 16, it reached a high of Rs 2,709. The stock’s worth this year has more than doubled! This occurred after the company acquired a Letter of Intent (LoI) from the Indian Coast Guard (ICG) for 9 additional Advanced Light Helicopters (ALH) Mk-III.

The state-owned aerospace and defense company’s stock has risen above the previous record high of Rs. 2,639 set on September 12, 2022. 3.23 million shares were traded on the NSE and BSE together up to 1:31 p.m., more than doubling the counter’s previous trading volume.

The company’s earnings increased by 44.15 per cent in the September quarter, from Rs 847 crore in the corresponding quarter last year to Rs 1,221 crore. A 90 percent increase in the company’s other income was the cause of the profitability growth. But the quarter’s revenue had decreased 7 per cent year over year.

Hindustan Aeronautics Ltd. (HAL), an aerospace and defense business owned by the Indian government, is based in Bengaluru, Karnataka, India. The business is run through a network of production sites, as well as research and design hubs throughout India.

HAL produces and manufactures helicopters, avionics and communication equipments indigenously

The business creates, produces, manufactures, and provides helicopters, avionics, and communications equipment for both the military and civil industries. Additionally, it offers support, maintenance, and repair services for airplanes.

The final of the 16 ALH Mk-IIIs was delivered to ICG on Tuesday, November 15, according to a statement from HAL. A contract for the supply of 16 ALHs to ICG by HAL and a value of approximately Rs 5,126 crore was signed in March 2017.

HAL developed, built, and designed the ALH Mk III on its own. According to the company’s press statement, it has so far built more than 330 ALHs, a multipurpose helicopter with more than 3.74 lakh flying hours. 

ICG has merely signed a LoI, therefore according to ICICI Securities, HAL should receive this contract for nine additional ALHs within the next six months. HAL would be able to produce 60 helicopters annually, which may include ALH, Light Combat Helicopters (LCH), or Light Utility Helicopters (LUH), once the new Tumkur (Karnataka) plant is slated to be operational in Q3FY23.

ICG has signed a LoI (Letter of Intent), and within the next six months, HAL ought to acquire this contract for nine more ALHs

The brokerage stated in a note that HAL has an order book of Rs 83,858 crore as of September 2022 (3.2x TTM revenues) and an order pipeline of Rs 50,000 crore for the next one to one and a half years, which would include this order and other helicopter orders like 25 ALHs for the Army and six LUHs for the IAF and Army.

HAL reported an income of more than Rs 24,000 crore, a record-breaking amount! The firm also disclosed a 20 rupee dividend per share. In the interim, HAL’s stock will become ex-date for an interim dividend of Rs 20 on Friday, November 18. The record date for the payment of the first interim dividend has been set by the firm as Monday, November 21.