HAL clocks ‘highest ever’ revenue at ₹29,810 cr in FY24; stock hits 52-week high

State-owned aerospace & defence major Hindustan Aeronautics Ltd (HAL) shares hit a 52-week high today as the company announced the “highest ever revenue” from operations at ₹29,810 crore for FY2023-24, the double-digit growth of around 11% against 9% (₹26,928 crore) in the previous year.

Shares of HAL opened ₹3,393.80 on the BSE and hit a one-year high at ₹3,454.35. As of the market closing today, 1.53 lakh shares were exchanging hands on the counter against a two-week average of 0.94 lakh. At the current share price, HAL's m-cap stands at ₹2.2 lakh crore. HAL share has been a blockbuster share, giving 150.29% return in the past year. The scrip has surged 20.13% in the year-to-date alone. In the past month and six months, the share has surged 7.70% and 73.59%, respectively.

"Despite the major supply chain challenges arising due to geopolitical issues, the company has met the expected revenue growth with improved performance for the entire year. As of March 31, 2024, the company's order book stands in excess of ₹94,000 crores with additional major orders expected during FY 2024-25," says C. B. Ananthakrishnan, CMD, HAL.

HAL says it has received fresh manufacturing contracts of over ₹19,000 crore and repair and overhaul (ROH) contracts of over ₹16,000 crore in FY 2023-24. As per the defence major, a significant milestone achieved in the year was with the first production series fighter of LCA Mk1A completing its maiden flight on ~8th March 2024.

Calling FY2023-24 "very eventful", the company says the year for HAL was dotted with high-profile visits and achievements that make the year special on various fronts such as customer satisfaction, branding & recognition and building stakeholder trust and confidence.

During the year, HAL and General Electric, USA had also signed an MoU for manufacturing of, GE-414 -aero-engine in India for LCA MK2 Aircraft. The company says it would “receive 80% technology transfer for this program, which would transform the Indian Aero Engine Manufacturing Ecosystem to be self-reliant. During FY24, a joint venture SAFHAL Helicopter Engines Pvt. Ltd was also formed with Safran Helicopter Engines, France for the indigenous design and development of Engines for IMRH and DBMRH.”

Additionally, HAL says its contract with Airbus for establishing MRO facilities for the A-320 family of aircraft in New Delhi will strengthen the “Make-in-India” mission and also enhance export potential.

The company’s revenue and profit after tax have grown at 7.9% & 19% CAGR, respectively, over the period FY20-23. ICICI Securities, in its latest analysis of the company, says that HAL is “strongly placed” to benefit from a pick-up in the execution of the existing strong order backlog and robust pipeline. “We estimate revenue, EBITDA and PAT to grow at 11.5%, 11.3% and 12.0% CAGR respectively over FY23-26E.” The brokerage has recommended a “BUY” rating on the HAL stock, with a target price of ₹3,660 per share (based on 36x FY26E EPS).