HAL Share Price: Today- Shares of state-run Hindustan Aeronautics (HAL) fell nearly 7 per cent on Thursday, extending losses from Tuesday’s trading session during which the stock fell over 3 per cent amid a sell-off in the defence sector just ahead of the Budget. HAL shares opened flat at Rs 5,325 against its previous close of Rs 5,329.40. After a negative opening, HAL shares witnessed further selling pressure and fell 6.65 per cent to a low of Rs 4,975. A sell note from brokerage firm Incred cited valuation concerns in defence stocks and stocks like HAL. The note is dated July 7. The brokerage firm compares HAL with its global rival Dassault Aviation. Dassault reported revenue of $5.19 billion with a profit of $974 million in the previous fiscal, while HAL reported revenue of $3.67 billion with a profit of $921 million in the same period. However, HAL is trading at an enterprise value of $41 billion, while Dassault Aviation’s is $6.7 billion.
“Dassault Aviation’s revenue/earnings are expected to grow at a compounded annual growth rate of 24 per cent and 12 per cent, respectively, over the next two years, while HAL’s is expected to be around 13 per cent/8 per cent,” the sales note said. Dassault exits calendar year 2023 with an order backlog of $41 billion, while HAL has an order backlog of $11 billion. Out of the 16 analysts who have coverage on Hindustan Aeronautics, 14 have a “buy” rating and one each has a “hold” and “sell” rating. After two days of decline, consensus price targets are estimating a potential upside of 4 per cent in the defence PSU’s shares. HAL shares are up from the day’s low but are trading 4.6 per cent lower at Rs 5,085. On Wednesday, the stock made an intraday low of Rs 4,975. It has declined since hitting a record high of Rs 5,675 on July 14.
At the current price, HAL shares are trading at a FY26 price-to-earnings multiple of 38.26 times, well above its five-year average price-to-earnings multiple of 23.6 times. As per June quarter shareholding data, the number of small shareholders in HAL, i.e. those with an authorised share capital of less than Rs 2 lakh, grew 60 per cent to 10.8 lakh from 6.9 lakh at the end of March, up from the March quarter. India’s domestic mutual funds reduced their stake in the PSU stock to 5.8 per cent from 6.75 per cent in March. Foreign portfolio investors (FPIs) stake in HAL has also declined from 12.42 per cent to 11.68 per cent. Despite this decline, the stock has seen a gain of 80 per cent so far in 2024. HAL is part of the BSE 100 index. According to analytics, HAL shares have given a positive return of 38 per cent in the last three months and 70 per cent in six months. In one year, HAL shares have given a multibagger return of 163 per cent to its investors. In two and three years, HAL shares have shown a strong rally of 470 per cent and 843 per cent respectively.
