HAL Secures ₹62,700 Crore Defence Deal, Share Price Surges Over 7%

Hindustan Aeronautics Limited (HAL), India’s leading aerospace and defence firm, has signed two significant contracts with the Ministry of Defence worth ₹62,700 crore. It was announced on 28 March 2025, and has already pushed HAL’s share price up more than 7% in the early trade today, reflecting investor confidence.

Defence Contracts in Brief

The contracts will enhance the combat capability of the Indian Armed Forces through the supply of 156 Light Combat helicopters (LCH) named Prachand. Of these, 90 helicopters will be supplied to the Indian Army and 66 to the Indian Air Force. Supply will commence in the third year from the contract date and is expected to be completed within five years.

The LCH is also the first Indian indigenously designed and developed combat helicopter capable of being operated at high altitude, above 5,000 meters. The project will have an indigenisation content of more than 65% on execution and will see the involvement of more than 250 domestic companies, most of them MSMEs, and provide over 8,500 direct and indirect employment opportunities.

Financial Performance and Market Reaction

This was as HAL's stocks also jumped over 7.58 per cent to ₹4,492.80 on the Bombay Stock Exchange (BSE) after the announcement. By midday trades, the stock was up 5.82% at ₹4,419.00. The company’s order book is now at a whopping ₹1,84,000 crore, nearly double it started FY25 with ₹94,129 crore.

HAL also announced provisional revenue at ₹30,400 crore for FY25 amid challenges in Light Combat Aircraft (LCA) and Advanced Light Helicopters (ALH) deliveries. Its top line was bolstered by the speedy delivery of other products.

The global brokerage, UBS, has increased its price target for HAL shares from ₹4,800 to ₹5,440 per share citing better visibility on its order book and execution capabilities. 

Strategic Significance

This agreement represents a major step for India’s defence initiative which emphasizes self-reliance through indigenous production under the Make in India initiative. With HAL’s LCH Prachand improving high-altitude combat abilities and opening possibilities for indigenous suppliers, this project coincides with national priorities for defence modernization and job creation.

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