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Informist, Wednesday, May 14, 2025

By Avishek Rakshit

KOLKATA - Hindustan Aeronautics Ltd. reported a year-on-year fall in net profit for the first time in the last eight consecutive quarters in Jan-Mar and its revenue declined for the first time in the past nine straight quarters. However, the Tejas light combat aircraft maker was able to beat the Street's projections by a wide margin.

The company, which was awarded 'Maharatna' status last year, reported a near 8% on-year fall in net profit for the March quarter to INR 39.58 billion against the Street's expectations of INR 30.10 billion. The revenue declined by over 7% on year to INR 137 billion, higher than the Street's estimate of INR 131 billion.

Although Hindustan Aeronautics, or HAL as it is commonly referred to, did not give reasons for the decline in revenue, analysts tracking the sector, when giving their projections for the company, had said delays in execution of orders, particularly Tejas and advanced light helicopter, could impact the company's financials in the March quarter.

HAL's total order book as on Mar. 31 was INR 1.8 trillion, with the company having received orders worth INR 1 trillion and repair and overhaul contracts worth INR 175 billion in 2024-25 (Apr-Mar). Recently, the company signed a contract with the defence ministry for supply of 156 light combat helicopters 'Prachand' worth INR 627.8 billion, which is the single largest procurement by the ministry from the company till date.

The Bengaluru-based public sector aviation and avionics major, which is engaged in design, development, manufacture, repair and overhaul of a wide range of aircraft, helicopters, and aero engines along with making industrial marine gas turbines, had guided for an order book of INR 470 billion for FY25.

Drop in expenditure helped the company limit the fall in March quarter profit. Total expenses declined by over 4% on year to around INR 92 billion mainly on account of a drop in capitalised expenses, finance costs, and purchase of goods meant for reselling. Raw material costs, however, rose sharply by nearly 78% on year to INR 116 billion. Steel prices were on an upswing in Jan-Mar. Employee benefit expenses increased by over 30% on year to INR 18 billion and impairment loss increased 101% on year to nearly INR 99 million.

HAL's net profit for FY25 increased by around 10% to over INR 83 billion and revenue rose by around 2% to around INR 310 billion. On Wednesday, shares of the company closed 3.4% higher at INR 4,768 on the National Stock Exchange.  End

Edited by Ashish Shirke

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