Earnings Review
HAL's Oct-Dec net profit, revenue beat Street estimates
This story was originally published at 15:47 IST on 12 February 2025
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--HAL Apr-Dec revenue INR 172.81 bln vs INR 156.12 bln year ago
--HAL Apr-Dec net profit INR 43.59 bln vs INR 33.03 bln year ago
--HAL Oct-Dec revenue INR 69.57 bln vs INR 60.61 bln year ago
--HAL to pay INR 25 per share interim dividend
--HAL Oct-Dec net profit INR 14.33 bln vs INR 12.54 bln year ago
--Analysts saw HAL Oct-Dec net profit INR 13.25 bln
--HAL Oct-Dec net profit INR 14.33 bln
By Sunil Raghu
AHMEDABAD – If investors of Hindustan Aeronautics Ltd., or HAL were feeling spooked by the comments of Indian Air Force chief Chief Marshal A.P. Singh on Monday, when he expressed his lack of confidence in the 'Maharatna' for delay in delivery and upgrades to light combat aircraft - Tejas, the company's December quarters earnings announced could perhaps sooth some nerves.
On Wednesday, the public sector defence manufacturer reported a net profit of INR 14.33 billion in Oct-Dec, up 14.27% on year, while its revenue rose 14.78% to INR 69.57 billion. Both the numbers are decently above the Street's estimates. Analysts had estimated HAL to record a net profit of INR 13.3 billion in Oct-Dec, on a revenue of INR 65.2 billion. In Oct-Dec of 2023, HAL had reported a net profit of INR 12.54 billion on revenue of INR 60.61 billion.
The positive earnings came in the backdrop of D. K. Sunil, chairman and managing director at HAL, assuring Singh that the public sector company will honour the timelines and deliver at least 11 Tejas Mk-1A aircraft to the Indian Air Force by March-end.
The on-year net profit growth is lower compared to the last three quarters, but on the revenue front, the on-year growth is higher than the last two quarters. Sequentially, the company's net profit fell 3.8%, while revenue rose 16.40%.
The Bengaluru-based public sector aviation and avionics major is engaged in the design, development, manufacture, repair and overhaul of a wide range of aircraft, helicopters and aero engines along with making industrial marine gas turbines.
The defence equipment maker's net profit in Apr-Dec is INR 43.59 billion, compared to INR 33.03 billion a year ago. The revenue for the first nine months of 2024-25 (Apr-Mar) came in at INR 172.81 billion compared to INR 156.12 billion a year ago.
During the September quarter, HAL secured a major order worth INR 260 billion to supply 240 aero engines for the Indian Air Force's Su-30 MKI aircraft, pushing its total order book to INR 320 billion. Despite this substantial order win, the company's revenue for the quarter did not fully reflect this contract, as the execution is scheduled over the next eight years.
Similarly, during the December quarter, HAL bagged orders worth INR 135 billion from the Ministry of Defence to supply 12 Su-30 MKI aircraft to Indian Air Force, taking its announced intake in the manufacturing segment to INR 395 billion this financial year so far, out of the company's guidance of INR 470 billion for FY25, analysts said.
Analysts had highlighted that while these orders strengthen long-term revenue potential, they will contribute to revenue incrementally over an extended period. Besides execution of the order book, it was expected that the traction in repair and overhaul operations revenue may contribute to the revenue growth.
The company's total expenditure for the quarter rose 14.75% on year to INR 55.53 billion, of which raw material costs increased 13.16% to INR 31.80 billion. Other expenses rose 9.15% on year to INR 4.16 billion.
The company's board also approved an interim dividend of INR 25 per share.
On Wednesday, shares of Hindustan Aeronautics ended at INR 3,594.15 on the National Stock Exchange, down 1.5%. End
Edited by Tanima Banerjee
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