Add Hindustan Aeronautics, target price Rs 3385: ICICI Securities

ICICI Securities has add call on Hindustan Aeronautics with a target price of Rs 3385. The current market price of Hindustan Aeronautics is Rs 3022.6.

Hindustan Aeronautics, incorporated in the year 1963, is a Large Cap company (having a market cap of Rs 101118.78 crore) operating in Defence sector.

Hindustan Aeronautics key Products/Revenue Segments include Sale of services, Engineering Goods, Spares And Others, Development Projects, Miscellaneous and Other Operating Revenue for the year ending 31-Mar-2022.


Investment Rationale
While we believe HAL is in a sweet spot with firm orderbook potential, execution is the key and CMP partially reflects the same. Our revised TP for HAL works out to Rs3,385 on DCF methodology, implying 14% upside from the current level. Hence, we downgrade HAL to ADD.

Financials
For the quarter ended 31-03-2023, the company has reported a Consolidated Total Income of Rs 13216.90 crore, up 114.47 % from last quarter Total Income of Rs 6162.72 crore and up 9.58 % from last year same quarter Total Income of Rs 12061.79 crore. Company has reported net profit after tax of Rs 2844.64 crore in latest quarter.

The company’s top management includes Mr.R Madhavan, Mr.C B Ananthakrishnan, Dr.Divya Gupta, Mr.Deepak Abasaheb Shinde, Mr.Alok Verma, Mr.E P Jayadeva, Mr.Arup Chatterjee, Mr.Chandraker Bharti, Dr.(Ms.)Tessy Thomas. Company has Maharaj N R Suresh & Co. LLP as its auditors. As on 31-03-2023, the company has a total of 33 crore shares outstanding.

Promoter/FII Holdings
Promoters held 71.65 per cent stake in the company as of 31-Mar-2023, while FIIs owned 9.07 per cent, DIIs 13.93 per cent.