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HAL aerospace & defence stock gained over 500% in three years

11 December 20233 mins read by Angel One
The Defence Acquisition Council recently approved Rs 2.23 lakh crore defence equipment purchase, 98% from Indian industries, boosting self-reliance.
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Hindustan Aeronautics Limited has churned multibagger returns to its shareholders in the last three years. During this period, the company’s share price jumped from Rs 428.40 on December 11, 2020, to Rs 2,787.20 on December 11, 2023, an increase of more than 500%.

An investment of Rs 1 lakh in the shares of this company three years ago would have turned to Rs 5.00 lakh today.

Recently, the Defence Acquisition Council (DAC) approved capital acquisition proposals worth Rs 2.23 lakh crore, aiming to enhance the operational capabilities of the Armed Forces. Notably, 98% of this amount will be sourced from domestic industries, promoting ‘Aatma Nirbhar Bharat’ in defence procurement.

Financial Performance

Hindustan Aeronautics Limited reported a strong second quarter for FY24, with net sales growth of 9.54% to Rs 5,635.70 crore, compared to Rs 5,144.79 crore in the same quarter last year. The operating profit also experienced a significant increase of 1.87%. The net profit for the quarter stood at Rs 1,008.53 crore, which was Rs 1,078.87 crore in the previous year’s same quarter.

Business Overview

HAL is engaged in designing, developing, manufacturing, repairing, overhauling, upgrading and servicing a wide range of products including aircraft, helicopters, aero-engines, avionics, accessories and aerospace structures. The company was set up to meet the requirements of the Indian Defence Forces (namely Indian Airforce, Indian Navy, Indian Army and Coast Guard) in the area of Aerospace.

Stock Price Movement 

Today, the stock opened at Rs 2,740, with a high and low of Rs 2813.30 and Rs 2,723.25, respectively. The stock closed trading at Rs 2,793, which increased by 2.19%. The stock has a 52-week high of Rs 2,813 and a 52-week low of Rs 1,150.50. The company has an ROCE of 30.6% and an ROE of 27.2%, with a market capitalization of Rs 1,86,789 crore.

The stock has shown impressive growth, and investors should keep a close eye on this stock.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.

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