Brokerage firm Citi has maintained a ‘Buy’ rating on the stock with a price target of ₹6,175 per share, implying an upside of around 23% from the previous close.
In a note, Citi said HAL has seen multiple developments that could have near- and medium-term implications for the company.
Improvement in Tejas Mk1A engine supplies, fresh procurement clearances, greater outsourcing to the private sector and progress towards engine development for future helicopter programmes provide incremental comfort on some of the key investment concerns that have weighed on HAL’s trading multiples, Citi said.
The brokerage added that while some investors remain concerned about private-sector players gaining market share from HAL, the Street may be underestimating the strengthening execution of HAL’s key programmes through private-sector participation.
“Stock has started reflecting some of the recent positives,” Citi said.
At around 31 times its FY28 estimated price-to-earnings ratio, HAL trades at a discount to broader Indian defence peers, making the risk-reward favourable, according to Citi. The brokerage sees scope for further re-rating once LCA Tejas Mk1A deliveries begin.
A day earlier, CLSA maintained an ‘Outperform’ rating on HAL with a price target of ₹5,481.
The Defence Acquisition Council’s (DAC) approval for the procurement of 138 Advanced Light Helicopters (ALHs) from HAL is expected to further strengthen the company’s order pipeline.
According to CLSA, the procurement could add around 13% to HAL’s existing $27 billion order backlog. The company could also receive around $600 million in cash advances.
CLSA said HAL’s decadal pipeline remains healthy at $48 billion. It sees the start of Mk1A deliveries in the second half of the year and visibility on the GE engine production deal as key catalysts for the stock.
The brokerage also said HAL remains the cheapest pure-play defence stock despite its sector-leading position. It believes the stock deserves to trade at a premium to global aerospace peers, given its strong Make-in-India pipeline and market access.
Of the 30 analysts covering Hindustan Aeronautics, 24 have a ‘Buy’ rating, two have a ‘Hold’ rating and four have a ‘Sell’ rating on the stock.
Shares of Hindustan Aeronautics were trading 0.25% higher at ₹5,043.90. The stock has gained around 15% so far in 2026.
