HAL Profit Rises 16% to ₹1,936 Crore; Margin Squeeze Weighs on Shares

Synopsis

Hindustan Aeronautics' consolidated net profit jumped 16% to ₹1,936 crore in the September quarter, while revenue grew 14.8% to ₹7,613 crore. EBITDA grew by 11.6% to ₹1,739 crore while expenses increased, leading to a decline in EBITDA margin to 22.8% from 23.5%. Its shares have dipped by as much as 4.15% so far so that day. CLSA maintained “Outperform” rating and also put its target price at ₹5,625 on LCA Mk1A deliveries.

The consolidated net profit of the Hindustan Aeronautics Limited (HAL) increased by 16% from ₹1,669 crore in the previous period to ₹1,936 crore in the quarter that ended in September 2026. Revenue from operations increased by 14.8% to ₹7,613 crore from ₹6,629 crore a year ago.

Margins under pressure

EBITDA rose 11.6% to ₹1,739 crore, but the EBITDA margin narrowed to 22.8% from 23.5%. The total expenses increased by approximately 16% to ₹6,132 crore from ₹5,296 crore. Profit growth outpaced revenue growth, and this was because of other income and lower tax drag (which was not broken out in the reports reviewed), rather than because expenses slowed down.

Market reaction

The shares fell as much as 4.15% during the day to ₹4,738.80, and were down 2.45% at ₹4,822.65 by noon. The same report states that the stock still has fallen just over 10% YTD but has increased more than 582% over five years.

The brokerage view

CLSA has kept its “Outperform” rating and raised its target price for the stock to ₹5,625 from ₹5,581. It said deliveries of the Light Combat Aircraft (LCA) Mk1A are likely to commence soon and comments by Air Chief Marshal A.P. Singh on reviving the strength of the Indian Air Force (IAF) are a good indication that the programme has no fundamental issues. The government is seeing some success in its Make in India strategy for indigenisation of defence, it added.

Order Book and Outlook of the Book

As of March 31, 2026, according to the latest reports, HAL's order book touched an impressive ₹2,54,538 crore. Whether revenue growth continues to be in double digits and whether margins will improve will depend on the timing of the execution and delivery, particularly of the LCA Mk1A.

The quarter confirms a trend that investors have come to know and understand: consistent growth on a very solid order books, delivery timing and cost control coming in as a variable.