HAL - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

🛫 Investment Analysis: HAL (Hindustan Aeronautics Ltd.)

Investment Rating: 4.3

✨ Core Fundamentals

ROCE (33.9%) and ROE (26.1%) signal excellent capital efficiency and shareholder value creation.

Debt-to-Equity: 0.00 — a pristine balance sheet.

EPS of ₹125 reflects strong bottom-line performance.

Dividend Yield: 0.89% is modest, but highlights HAL's reinvestment emphasis.

Despite a negative Qtr Profit Var (-7.71%), prior PAT jump suggests variability due to large orders — common in aerospace.

📊 Valuation & Price Trend Metrics

P/E of 36.0 is significantly below the industry P/E of 68.0, suggesting relative undervaluation.

PEG Ratio of 1.99 implies that growth may be priced in at a premium — important to monitor.

RSI (29.7) shows HAL is currently in oversold territory, making the stock potentially undervalued for entry.

MACD is deeply negative (-94.6) — short-term bearish, but can signal a bottoming out.

Price sits above 200-DMA (₹4,413) but below 50-DMA (₹4,770) — showing pullback after prior strength.

📌 Ideal Entry Price Zone: ₹4,100 – ₹4,350 Near the 200-DMA and below current levels — aligns with oversold RSI and historical support zones.

🚦 If You're Already Holding

With strong long-term metrics (ROE, ROCE, zero debt), HAL remains a high-quality hold for 5–8 years.

Defense spending tailwinds and HAL's monopoly status in aircraft manufacturing boost its strategic profile.

Exit Strategy

Consider profit booking near ₹5,000–₹5,100, especially if RSI crosses 70.

Reassess if PEG exceeds 2.5, or if quarterly earnings show continued contraction.

Maintain exposure if dividend improves and earnings stabilize post lump-sum contracts.

Would you like a visual trend chart or peer comparison with other defense and aerospace players like BEL or BEML? I can stitch it together for you in a snap.

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