Latest news with #ALH
&w=3840&q=100)
Business Standard
19-05-2025
- Business
- Business Standard
Guidance, stock rally may keep Hindustan Aeronautics under pressure
Hindustan Aeronautics' (HAL) performance for FY25 was driven by improved margins and lower provisions. The order book as of March '25 was of Rs 1.8 trillion, with inflows of Rs 1 trillion during FY25. Given more assured engine supply from GE, HAL is optimistic about delivering 12 Tejas Mk1A aircraft during the year. The guidance was for a conservative 8-10 per cent revenue growth. HAL reported a decent set of numbers in Q4FY25, with revenue at Rs 13,700 crore (down 7 per cent Y-o-Y). The operating profit dipped 10 per cent Y-o-Y to Rs 5,290 crore, while margins at the operating level dipped 140 basis points Y-o-Y to 38.6 per cent. The net profit margin stood at 29 per cent. Net profit was down 8 per cent Y-o-Y due to reversals of some provisions received during FY24, resulting in higher net profit base in Q4FY24. For FY25, revenue was up 2 per cent to Rs 30,980 crore while operating profit increased 18 per cent to Rs 9,610 crore while margin expanded 370 basis points Y-o-Y, led by lower provisions. Due to lower depreciation and a spike in other income, reported net profit grew 10 per cent Y-o-Y to Rs 8,360 crore. Adjusted net profit grew 38 per cent Y-o-Y. The LCA Mk1A programme saw the resolution of engine supply issues from GE. The first F404 engine was delivered in April this year, and successfully integrated. GE committed to delivering 12 engines in CY25, enabling HAL to target 12 LCA deliveries. In FY25, revenue consisted of 23 per cent manufacturing with repair/overhaul or ROH being 70 per cent and rest 7 per cent being exports and design and development (D&D). Given the order book and opportunities, there could be sustained long-term growth. The order book included 156 light combat helicopter (Prachand) (Rs 62,800 crore), 240 AL-31FP engines (Rs 25,500 crore), and 12 Su-30 MKIs (Rs 13,500 crore), alongside ROH (Rs 19,270 crore), D&D (Rs 3,180 crore), and exports (Rs 490 crore) orders. HAL expects annual ROH orders of around Rs 20,000 crore, driven by in-service fleets like the ALH (340+), Su-30s (250+), Jaguars, and Dorniers. Going ahead, the LCA MK1 would be entering the overhaul phase and there are sustained platform additions. HAL will deliver 12 Su-30s under a new contract starting FY27. The Rs 60,000 crore Su-30 avionics upgrade project is in the approval phase, with D&D in FY26 and aircraft orders by FY31. The 156-unit LCH Prachand order will begin delivery in FY28, with execution over 5.5 to 6 years. ALH deliveries are expected to accelerate in FY26. In FY25, HAL reported total provisions of about Rs 2,500 crore. There was an exceptional Rs 804 crore provision allocated for an engine damaged during repairs, classified as a precautionary provision. This was not a write-off but a provisioning with prudent accounting practices. The management said future provisioning is expected to remain stable, with deviations limited to 3-5 per cent. There were no write-backs or reversals of earlier provisions. Key risks include slower-than-expected finalization of large orders, delays in deliveries of key components such as engines, delays in payments and possible competition for the private sector. The execution of Tejas Mk1 delivery will be major monitorable. Given everything, revenue may record a annual growth of 21 per cent over FY25-27, due to manufacturing scale-up. Operating profit margin should remain at 28-30 per cent. Given annual capex of Rs 4,000-5,000 crore and good working capital management, net profit should have mid-teens growth over FY25-27. Return on equity and capital employed should be over 20 per cent.
Mint
15-05-2025
- Business
- Mint
Hindustan Aeronautics: Here's all you need to know before investing
Few companies in India have garnered as significant an impact in the aerospace and defence sectors as Hindustan Aeronautics Ltd (HAL). The state-owned giant has been instrumental in shaping the future of India's aerospace and defence capabilities. With decades of expertise, HAL has grown beyond being a mere supplier of military aircraft to becoming a strategic enabler of national defence, advancing the country's aspirations of self-reliance under initiatives like Make in India. From manufacturing state-of-the-art aircraft to developing cutting-edge drones, HAL's journey is a testament to its resilience, innovation, and vision for the future. The company's financial trajectory, bolstered by a substantial order book and strong government backing, signals strong growth prospects, making it a worthy stock to watch. Here's everything you need to know before investing in HAL. About the company Hindustan Aeronautics (HAL) is one of the largest and most renowned aircraft manufacturing companies in India. With a history spanning over seven decades, HAL has been instrumental in the design, development, and production of various aircraft, helicopters, and aero engines. The company's notable achievements include the production of indigenous aircraft like the Tejas Light Combat Aircraft (LCA) and the Advanced Light Helicopter (ALH). HAL's expertise extends to aircraft upgrades, overhaul services, and the manufacture of aero structures, avionics, and other critical components. It has 20 production and overhaul divisions and 9 R&D centres across India. The company inaugurated a new design and test facility at Aero Engine Research & Development Centre in Bangalore in December 2023, to accelerate R&D of aeroengines. HAL has historically been one of the PSUs with largest allocation to R&D costs. The company spends around 8% of the total revenue on R&D. Also, it has created an R&D reserve. An annual contribution of 15% of the operating profit, is transferred into this reserve. HAL's Giant Leap The company's role in India's defence sector is evolving, thanks to strategic initiatives like the Make in India program. This initiative has allowed HAL to step up its innovation game, resulting in enhanced revenue visibility and an increased appetite for taking on capital-intensive projects. HAL's massive order book continues to expand, with major inflows expected in the near future. The company's aggressive push into export markets has also contributed to its growth. With platforms like the LCA Tejas gaining international recognition, HAL is steadily enhancing its export portfolio, positioning itself as a key player on the global defence stage. Notably, HAL has been awarded the largest proposal approval in its history—a project worth ₹70,500 crore for the construction of 60 marine utility helicopters, with an estimated cost of ₹32,000 crore. What makes HAL particularly interesting for investors is its exposure to the growing drone market. The company is at the forefront of developing AI-driven, advanced drones for high-altitude strategic missions. Its emphasis on reducing foreign dependency for such technology aligns with the government's self-reliance goals. Order Book Strength HAL's order book is a key pillar of its growth story. The company's net profit has grown at a CAGR of 26% in the last three years supported by its healthy growth of order book and timely execution. At the end of FY25, its order book stood at a little over ₹1.2 trillion. This is up from ₹94,000 crore as of FY24 and ₹82,000 crore in FY22. In recent times, HAL has received substantial contracts for repair and overhaul services. A landmark contract awarded to HAL by the ministry of defence was in September 2024, for the supply of 240 aero-engines for the Su-30 MKI aircraft, worth ₹26,000 crore. This growing order book provides HAL with visibility for future revenue streams, making it a solid investment proposition. Moreover, HAL is expected to secure additional major contracts over the next few years, with the total order inflows expected to range between ₹1.6 trillion to ₹1.7 trillion over the next 18 months to three years. The management expects full workload until 2032 and expects to maintain double-digit growth in sales. It has also planned ₹14,500 crore capex over five years for capacity expansion and modernisation. HAL is poised for significant order inflows, with ₹1.3 trillion worth of contracts for 97 LCA Tejas Mark 1A and 156 LCH Prachand at an advanced stage of clearance, expected to materialise within the next three to six months. Nevertheless, investors should note that the company has received some criticism due to the delay in delivery of the fighter jets. The typical execution period for the order book extends to a few years, which could further stretch due to time taken to build capabilities. As such, the risk of overruns cannot be ruled out, impacting margins. Financial Performance HAL's financial performance has been robust. Its sales have been growing smoothly. During 2020-24, the sales and net profit have grown at a CAGR of 9.6% and 26%, respectively. The returns have been admirable, reporting an average RoCE and RoE of 30% and 26%, respectively. Due to its large scale and healthy operating profitability, the company's debt coverage metrics remain strong. As a result, its liquidity position is strong, as evidenced by its cash balance of ₹26,400 crore. Given the volatile geopolitical scenario, defence companies like HAL will remain instrumental in India's manufacturing ecosystem and will play a crucial role in helping India become part of global defence supply chain. Stock Performance Over 5 Years HAL has seen its stock price surge significantly in recent years, delivering impressive returns to investors. Over the past one year, HAL's stock has moved up 16% while in the past 5 years it has surged 1,700%, fuelled by increasing investor confidence in the company's growth prospects. What next? The future of HAL is intrinsically tied to India's defence spending, which continues to grow as the government focuses on modernizing the armed forces and strengthening self-reliance in defence technology. HAL is well-positioned to capture a significant share of this increasing budget, particularly as the country looks to reduce reliance on foreign defence suppliers. HAL's drone initiatives are a key area of growth. The company is developing the CATS Warrior, an AI-driven unmanned combat aerial vehicle (UCAV) that will work alongside manned fighter jets. It's also developing the CATS Hunter, a companion system for unmanned and manned aircraft. The company has set its sights on the launch of the CATS Warrior II, an advanced drone with 10+ hours of endurance and a payload of 400–500 kg, set for production by 2027. In addition to drones, HAL's focus on advanced avionics, AI-driven systems, and the production of strategic aircraft and helicopters further strengthens its growth potential. With an expected capex investment of ₹3,000 crore per year until FY30, HAL's roadmap for the coming years is clear—continued growth, innovation, and deeper integration with India's defence ecosystem. Conclusion HAL's story is one of steady evolution, transforming from a traditional defence manufacturer into a modern aerospace and defence giant. As the company continues to innovate and execute, it could remain an attractive option for long-term investors looking to capitalize on India's defence and aerospace growth. However, HAL could face some surprise challenges along the way. Dealing with the government, its primary client, can be arduous due to high receivable days and orders that are heavily reliant on defence budget allocations. Investors should evaluate the company's fundamentals, corporate governance, and valuations of the stock as key factors when conducting due diligence before making investment decisions. Happy Investing. Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. This article is syndicated from
Time of India
03-05-2025
- Politics
- Time of India
'Trident of naval power': Indian Navy's latest post amid tensions with Pakistan
Indian Navy NEW DELHI: The Indian Navy on Saturday shared a picture of what it described as the "trident of Naval power " - a surface ship, a submarine and a helicopter. "The trident of Naval Power - Above, below and across the waves," the navy's media and public information wing captioned the post. The photo shows the destroyer INS Kolkata , the Dhruv Advanced Light Helicopter (ALH), and a Scorpene-class submarine . The picture, which has gone viral, is likely a file image as the Dhruv ALH is presently grounded in the Indian Navy. However, the government has cleared the Indian Army and Air Force variants of the ALH, following a detailed probe into the recent safety concerns. The navy's post comes amid heightened tensions between India and Pakistan in the wake of the deadly terrorist attack in Jammu and Kashmir's Pahalgam on April 22. Citing "cross-border linkages" to the attack, India has taken several diplomatic measures against Pakistan, including suspension of the Indus Waters Treaty, shutting down of the only operational land border crossing at Attari, revoking visas of Pakistani nationals, and downgrading of diplomatic ties. Prime Minister Narendra Modi has repeatedly vowed that the "perpetrators and conspirators" would face the "harshest response." Amid this, the Indian Navy has been conducting extensive drills in the Arabian Sea, with naval warships placed on high alert. "Warships are on high alert, with multiple anti-ship and anti-aircraft firings executed recently to demonstrate combat readiness and deter potential threats in the region," defence sources earlier told news agency ANI.
NDTV
03-05-2025
- Politics
- NDTV
Above, Below And Across Waves: Indian Navy's "Trident" Of Power
Quick Take Summary is AI generated, newsroom reviewed. The Indian Navy shared a picture of its naval power, including INS Kolkata, a helicopter, and a submarine, amid rising India-Pakistan tensions following a deadly terror attack in Jammu and Kashmir. New Delhi: The Indian Navy on Saturday shared a picture featuring a surface ship, a submarine, and a helicopter, calling it the "trident of Naval Power". The picture, posted on X, shows the destroyer INS Kolkata, the Dhruv Advanced Light Helicopter (ALH), and a Scorpene-class submarine. "The trident of Naval Power - Above, below and across the waves," the Navy wrote. The trident of Naval Power - Above, below and across the waves #FromSeaToSky #AnytimeAnywhereAnyhow — IN (@IndiannavyMedia) May 3, 2025 The picture, which has now gone viral, is likely a file photo as Dhruv ALH is presently grounded in the Navy. The post came amid heightened tensions between India and Pakistan over the deadly terror attack in Jammu and Kashmir's Pahalgam on April 22. India, citing "cross-border linkages" to the attack that left 26 people dead, has announced a raft of punitive measures against Pakistan, including suspension of the Indus Waters Treaty, shutting down of the only operational land border crossing at Attari and downgrading of diplomatic ties. Last week, Prime Minister Narendra Modi said the "perpetrators and conspirators" of the Pahalgam attack will be "served with the harshest response". "The whole world stands with 140 crore Indians in our fight against terrorism. I once again assure the affected families that they will get justice, and justice will be done," he said in his 'Mann ki Baat' address. "The perpetrators and conspirators of this attack will be served with the harshest response," he added.
New Indian Express
02-05-2025
- General
- New Indian Express
Army, IAF to fly Dhruv again after crash probe
BENGALURU: The Army and Air Force variants of the indigenous Advanced Light Helicopter (ALH) Dhruv have been cleared for operations, nearly four months after the entire fleet was grounded following a fatal crash in January. In an official press release issued by the HAL on Thursday, the clearance was granted based on the recommendations of the Defect Investigation (DI) Committee, which looked into the cause of the January 5 crash in Porbandar. 'A time-bound plan for the phased resumption of flying has been worked out with the users,' the release said. This clearance applies only to the Army and Air Force variants for now. The crash on January 5 involved an ALH Mark-III of the Indian Coast Guard, killing all three crew members during a training sortie. Following the incident, all 330 ALHs in service with the armed forces were grounded as a safety precaution. Investigators had found that the chopper had failed to respond to pilot inputs in its final few seconds. The root cause was identified as a fracture in the swashplate assembly, a critical part in the helicopter's transmission system. HAL officials had also suspected that a rare material failure may have led to the malfunction. Though the Army and Air Force variants have now been cleared, the advisory to civilian operators remains. HAL has asked them to keep their ALH Mark-III helicopters grounded until the investigation into the Porbandar crash is fully completed.
