HAL Q1 Results 2025 Preview: Defence PSU may post 10% rise in PAT, 14% YoY revenue growth; Tejas Mk1a deliveries eyed

Mint

5 days ago

Hindustan Aeronautics Ltd (HAL), the state-run defence company is set to announce its Q1 results on Tuesday. The meeting of the board of directors of HAL is scheduled on August 12 to consider and approve the financial results for the first quarter of FY26.
HAL share price traded higher on Monday ahead of the announcement of the Q1 results 2025. HAL shares gained as much as 2.4% to an intraday high of ₹ 4,546.55 apiece on the BSE.
The defence PSU is expected to report decent earnings growth, with revenue rising on the back of execution of the healthy order book, and margin expansion led by easing of supply chain issues.
Hindustan Aeronautics is expected to report a 10% net profit growth at ₹ 1,579 crore in the June quarter as compared to a net profit of ₹ 1,435.6 crore in the corresponding quarter of previous fiscal year, according to Livemint poll of three brokerages.
The company's revenue in Q1FY26 is estimated to grow 14% to ₹ 4,956 crore from ₹ 4,347.6 crore, year-on-year (YoY), led by the execution of the healthy order book of ₹ 1.8 lakh crore. Order inflows during the quarter are estimated to rise 17.8% to ₹ 5,300 crore from ₹ 4,500 crore, YoY.
'We expect healthy topline growth, underpinned by steady execution against a robust ₹ 1.8 trillion order book. Margins are likely to expand progressively, aided by increasing indigenization and easing supply chain bottlenecks. That said, we remain watchful of execution risks, particularly the adherence to Tejas Mk1 delivery timelines and the timely receipt of additional GE 404 engines,' said Krishna Doshi, Defence Analyst at Ashika Institutional Equities.
At the operational level, brokerage firm Nomura expects EBITDA to increase 11.4% to ₹ 1,107 crore from ₹ 993.8 crore, YoY, EBITDA margin to remain flat YoY. It expects other income to grow 18% YoY and depreciation expenses to remain flat.
Motilal Oswal Financial Services (MOFSL) expects HAL's Q1 revenue growth of 21% YoY, driven by a healthy execution of the opening order book of ₹ 1.8 lakh crore. It expects EBITDA margin to expand by 120 basis points (bp YoY, aided by increased indigenization and easing of supply chain issues.
'The execution of huge backlog, incremental inflows, and comfortable margin levels will be the key focus areas. Key monitorables include the status of Tejas Mk1a deliveries and Su-30 avionics upgrade project, any major deviation in provisions created, and the working capital cycle,' MOFSL said
The brokerage firm has a 'Buy' rating on HAL shares and increased its target price slightly to ₹ 5,750 per share.
Hindustan Aeronautics share price formed a mother bar with a high of ₹ 5,165 and low of ₹ 4,420 on the week of May 12, 2025, noted Anshul Jain, Head of Research at Lakshmishree.
'For the past 12 weeks, HAL share price has traded largely within this range, creating a mini coil pattern, reflecting indecision and compression in price action. A failure by bears to sustain below ₹ 4,420 will likely trigger short covering, propelling the stock toward the mother bar high of ₹ 5,165. Conversely, a decisive breakdown below ₹ 4,380 will open the door for a deeper decline toward the ₹ 4,000 zone,' Jain said.
According to him, the current pattern demands close monitoring for directional clarity.
HAL share price has fallen 8% in one month, but has rallied 22% in the past six months. The PSU defence stock has risen 7% on a year-to-date (YTD) basis, while it has jumped 135% in two years. HAL share price has delivered multibagger returns of 775% over the past five years.
At 3:15 PM, HAL share price was trading 0.11% higher at ₹ 4,444.90 apiece on the BSE.
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