HAL shares in focus after Q3 profit rises 14% YoY to Rs 1,440 crore; Morgan Stanley slashes target price
Revenue from operations rose 15% YoY to Rs 6,957 crore during the quarter. The company’s EBITDA increased 17% YoY to Rs 1,683 crore, with operating margins standing at 24.2%.
The board has also declared a first interim dividend of Rs 25 per share (with a face value of Rs 5 each, fully paid-up) and has set February 18 as the record date. The dividend will be paid to eligible shareholders on March 14.
The ordering activity in the defense sector remained robust throughout the quarter, and revenue growth was driven by the ongoing execution of the manufacturing order book, along with consistent increases in replacements and spares.
The spares and repair business constitutes a substantial portion of HAL’s total sales. Additionally, HAL secured an order worth Rs 13,500 crore from the Indian government for 12 Sukhoi fighter jets in December.
Following the Q3 results, Morgan Stanley maintained an ‘Overweight’ rating on HAL but reduced its target price to Rs 4,958 from Rs 5,135.The brokerage expects healthy revenue and order inflows in Q3FY25, with 9MFY25 orders driven by demand for Sukhoi engines and aircraft. It anticipates orders worth Rs 1,65,000 crore and notes that HAL is on track to roll out its first LCA (Tejas MK-1A) from its Nashik facility by the end of FY25.Also Read: Stocks in news: Hindalco, SJVN, Honasa Consumer, ICICI Bank, Tata Power
HAL shares performance
On February 12, HAL’s shares closed 1.4% lower at Rs 3,596. The stock has dropped 24% over the past six months but surged by 200% over the last two years. The company’s market capitalization stands at Rs 2,40,501 crore.
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