Latest news with #F404
India Today
03-06-2025
- Business
- India Today
After Air chief's rap on delays, HAL set to hand over Tejas Mk-1A this month
Days after Indian Air Force (IAF) chief Air Chief Marshal Amar Preet Singh voiced concern over repeated delays in defence projects, sources said Hindustan Aeronautics Ltd (HAL) is set to deliver the first Tejas Mk-1A fighter jet from its Nashik facility by the end of Nashik line is HAL's third Tejas production facility after two existing lines in Bengaluru, and is intended to accelerate the indigenous fighter jet programme that has fallen behind schedule due to multiple in the supply of F404 engines from US-based GE Aerospace have pushed the Tejas Mk-1A programme over a year past its original timeline. The Indian Air Force, which signed a Rs 48,000 crore contract in February 2021 for 83 Tejas Mk-1A jets, was originally slated to receive the first aircraft by March 31, 2024. 'The timeline is a big issue,' Air Chief Marshal Singh said last week at the CII Annual Business Summit 2025. 'So, once a timeline is given, not a single project that I can think of has been completed on time. So this is something we must look at. Why should we promise something which cannot be achieved? While signing the contract itself, sometimes we are sure that it is not going to come up, but we just sign the contract.'advertisementSingh's barbed remarks came nearly three months after he publicly rebuked HAL officials over persistent delays in Tejas Mk-1A deliveries. The Air Force has since urged HAL to expedite production and widen its private sector collaboration, particularly for key components like HAL line—Bengaluru and Nashik—has the capacity to produce up to eight aircraft per year, subject to engine flight trials are completed, the first Nashik-built Tejas Mk-1A will be formally handed over to the IAF, marking a key milestone in the indigenous fighter's production Air Force chief has stressed the importance of timely induction of new technologies into the military, especially in the context of rapidly evolving warfare paradigms involving drones and AI-enabled platforms.
Time of India
20-05-2025
- Business
- Time of India
UBS downgrades HAL shares to neutral, stock down 3% on muted near-term outlook
HAL shares: Global brokerage UBS downgraded the stock to 'Neutral' from 'Buy', stating that near-term catalysts have already been factored into the current price. HAL shares: UBS has set a new 12-month price target of Rs 5,600 per share for HAL, indicating a potential upside of 14.5% from its Monday closing price of Rs 5,016. The brokerage had previously set the target at Rs 5,440. Tired of too many ads? Remove Ads UBS flags slower order book growth Tired of too many ads? Remove Ads Revenue ramp already priced in Valuation and outlook Shares of Hindustan Aeronautics Ltd (HAL) fell as much as 2.8% to Rs 4,877.25 on Tuesday after global brokerage UBS downgraded the stock to 'neutral' from 'buy', citing that near-term triggers have already been priced in and lowering its order book growth set a new 12-month price target of Rs 5,600 per share, implying a potential upside of 14.5% from HAL's Monday closing price of Rs 5,016. The brokerage's previous target was Rs 5,440.'We downgrade HNAL to Neutral from Buy, as we believe: 1) near-term drivers (resolution of the GE F404 engine delay, the Light Combat Helicopter order, the LCA MK1A fighter aircraft order overhang) are now in the price,' UBS brokerage trimmed its FY26-28 order book compound annual growth rate (CAGR) estimate to 14% from 21% following recent management guidance that indicated a longer timeline for the Su-30 MKI upgrades and LCA Mark 2 also cut its manufacturing revenue growth estimates and now expects the topline contribution from manufacturing to rise from 23% currently to 40% by FY28, while MRO (maintenance, repair, and overhaul) share drops to 54% from 70%.'The market has priced in the resolution of the F404 engine issue and expects a 24% sales CAGR FY25-28E,' UBS noted, adding that HAL's manufacturing ramp-up, strong margin guidance, and expanded capacity across its LCA and helicopter factories are already factored into the stock brokerage said HAL's recently commissioned Tumkuru helicopter factory and expansion at its Bangalore and Nashik units will support a shift in the company's revenue mix toward manufacturing. However, it cautioned that 'a slower ramp in the manufacturing topline is the major downside risk to our Neutral rating.'UBS said it valued HAL at 35x 12-month forward earnings in its base case, reflecting strong growth visibility but limited near-term upside. 'We forecast order inflow of Rs 2.2 trillion over FY26-28 with a revenue CAGR of 21.5% for FY25-28E,' the brokerage brokerage projects average EBITDA margins of 28.6% over FY25-28E and net income growth at a CAGR of 12% in the same period. In the bullish scenario, net income could grow at 18.9%, while the bearish case sees a modest 5% noted HAL's strong positioning in India's expanding defence manufacturing landscape, driven by localisation efforts and growing domestic capex. However, it flagged risks such as delays in order finalisations, GDP-linked budget constraints, and execution bottlenecks in the private supply these risks, UBS acknowledged that HAL could still benefit from a faster-than-expected rollout of large defence contracts. 'Risk to current share price is skewed to the upside,' UBS said.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
