⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
HAL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.3
| Stock Code | HAL | Market Cap | 2,65,240 Cr. | Current Price | 3,961 ₹ | High / Low | 5,166 ₹ |
| Stock P/E | 30.0 | Book Value | 553 ₹ | Dividend Yield | 1.01 % | ROCE | 33.9 % |
| ROE | 26.0 % | Face Value | 5.00 ₹ | DMA 50 | 4,158 ₹ | DMA 200 | 4,385 ₹ |
| Chg in FII Hold | -1.14 % | Chg in DII Hold | 1.04 % | PAT Qtr | 1,852 Cr. | PAT Prev Qtr | 1,663 Cr. |
| RSI | 43.3 | MACD | -70.4 | Volume | 8,90,969 | Avg Vol 1Wk | 13,20,920 |
| Low price | 3,578 ₹ | High price | 5,166 ₹ | PEG Ratio | 1.69 | Debt to equity | 0.00 |
| 52w Index | 24.1 % | Qtr Profit Var | 29.3 % | EPS | 132 ₹ | Industry PE | 54.2 |
📊 Core Financials
- Quarterly PAT rose from ₹1,663 Cr. to ₹1,852 Cr. (~11% sequential growth, ~29.3% YoY growth).
- ROE: 26.0% → strong profitability.
- ROCE: 33.9% → excellent capital efficiency.
- Debt-to-equity: 0.00 → debt-free, strong financial health.
- Dividend Yield: 1.01% → modest but consistent shareholder returns.
💹 Valuation Indicators
- P/E Ratio: 30.0 vs Industry PE 54.2 → undervalued relative to peers.
- P/B Ratio: 7.16 (Current Price ₹3,961 / Book Value ₹553) → moderately expensive relative to assets.
- PEG Ratio: 1.69 → valuation supported by earnings growth.
- Intrinsic Value: Current price near fair value, offering long-term upside potential.
🏢 Business Model & Competitive Advantage
- HAL (Hindustan Aeronautics Limited) is India’s leading aerospace and defense manufacturer.
- Business model relies on aircraft production, defense contracts, and maintenance services.
- Competitive advantage: Government backing, strong order book, and strategic role in defense sector.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive near ₹3,600–₹3,800 (close to 52-week low, RSI at 43.3 indicates oversold zone).
- Long-Term Holding: Suitable for investors seeking exposure to defense sector growth, with strong fundamentals and government support.
✅ Positive
- Strong profitability with ROE of 26% and ROCE of 33.9%.
- Debt-free balance sheet ensures financial stability.
- Quarterly PAT growth of ~29.3% YoY shows operational strength.
- DII holdings increased (+1.04%), reflecting domestic institutional confidence.
⚠️ Limitation
- P/B ratio indicates moderate overvaluation relative to assets.
- Dividend yield is modest (1.01%).
- FII holdings decreased (-1.14%), showing reduced foreign investor confidence.
📉 Company Negative News
- Stock trading below 50 DMA (₹4,158) and 200 DMA (₹4,385), indicating bearish momentum.
- MACD at -70.4 signals weak technical trend.
📈 Company Positive News
- Quarterly PAT increased from ₹1,663 Cr. to ₹1,852 Cr.
- Strong government defense contracts continue to support growth.
🌐 Industry
- Aerospace and defense industry PE at 54.2, higher than HAL’s 30.0, showing relative undervaluation.
- Industry growth driven by defense modernization, rising military budgets, and export opportunities.
🔎 Conclusion
- HAL is fundamentally strong with excellent profitability, zero debt, and government-backed growth.
- Valuation is attractive compared to industry peers, offering long-term upside.
- Best strategy: Accumulate near ₹3,600–₹3,800 and hold long-term to benefit from India’s defense sector expansion.