Currently, India is focusing on the development of defense-related technologies. But the export aspect of the military has been important to investors. The Indian Defence Stock Hindustan Aeronautics Limited (HAL) was able to make a profit by 75% in 2022 because investments have paid off.
Hindustan Aeronautics Limited (HAL) has been identified as the defence Prime. This means that HAL is considered the kingpin of the Indian defence sector.
HAL is looking to expand defense exports which would help other state-owned companies in the Indian defense industry expand their work.
Investing in HAL has a 75% return on investment, investors who invested at the beginning of 2022 is now worth 75% higher.
Why is HAL surging?
HAL has been in talks with Egypt, Malaysia and Nigeria for over $5.5 billion worth of defence exports. This includes setting up manufacturing facilities for the Tejas Mk1A, helicopters, and Sukhoi fighter engine maintenance.
The Indian government is committed to boosting local defence manufacturing, which has benefitted HAL, who has been able to get a competitive edge in sales. HAL’s export offers are rated high for technicality, and have secured contracts in Egypt and Malaysia.
According to a report by ICICI Direct Research, HAL’s current order book of orders is 3.3 times their revenue for the year 2022. They have an orderbook of 1.24 trillion manufacturing orders over the next three to four years,
Hindustan Aeronautics is improving India’s defence exports
In the Defence Production Policy of 2018, the Indian government set out an ambition of hitting $5 billion in annual defence exports by 2025.
From $0.66 billion in 2017-18, India’s defence exports increased to $1.6 billion this year with the country securing a major defence deal for the BrahMos cruise missile with the Philippines for 375 million worth.
The major players in the Indian defense industry are HAL, Bharat Electronics, Bharat Dynamics, Bengal Forge, BharMos Aerospace and various other companies.
A Tejas success story, Hindustan Aeronautics Limited (HAL) defence stock boosted investors wealth by 75%
According to the government, six countries are interested in HAL’s light combat aircraft due to its success. Tell you that Tejas was first rejected by the Indian Navy because of it heavy-weight, but now Tejas has been one of the success stories of indigenization efforts.
HAL offered to produce the Tejas aircraft and helicopters for the Egyptian air force. As according to estimates, the Egyptian Air Forces needs 70 combat aircraft, estimated to be worth $3 billion.
HAL has supplied a deal for the Malaysian military, worth $1.5 billion and HAL will supply the maintenance for Russian 30 fighter jets.
The US, Australia, and Indonesia have also expressed an interest in the Tejas.