Newsletter
HAL gained initially after reporting Q4 earnings, but the stock cooled off from the day’s highs as investors digested weaker operating performance and margin pressure.
By the numbers:
- Net profit up 5.7% YoY to ₹4,184 crore
- Revenue up 1.8% YoY to ₹13,943 crore
- EBITDA margin at 36.3% vs 38.7% last year
The defence PSU also announced its highest-ever interim dividend of ₹35 per share for FY26.
So what happened: at first glance, profits looked solid. But operationally, the quarter was softer. Revenue growth remained slow, while margins took a hit as material costs surged nearly 29% YoY. Raw material expenses now make up 46% of sales, compared to 36% last year.
One positive though: the company had to set aside much lesser money for potential future expenses and risks this quarter, which helped support overall profits.
Zoom out: HAL remains one of India’s most important defence manufacturing companies, building fighter aircraft, helicopters, engines, and military systems for the Indian armed forces.
India’s defence production recently crossed ₹1.27 lakh crore, while the government wants domestic defence manufacturing to touch ₹3 lakh crore by 2029. With India pushing harder on self-reliance in military equipment and increasing defence spending, companies like HAL remain at the centre of the country’s defence growth story.
