Goldman Sachs’ upgrade of Hindustan Aeronautics Ltd. to ‘buy’ and increased target price have reignited investor interest, highlighting increased confidence in India’s defence manufacturing growth amid operational improvements and strategic partnerships.
Hindustan Aeronautics Ltd. drew fresh investor attention after Goldman Sachs upgraded the stock to “buy” and lifted its target price to ₹5,870, a move that implies notable upside from current levels. The reaction reflected renewed optimism around India’s defence manufacturing theme, even as analysts continued to distinguish between the scale, visibility and execution risks facing large established contractors and smaller emerging suppliers.
Vinit Bolinjkar, head of research at Ventura Securities, said the stock appeared to have moved out of a consolidation phase and could still have room to advance. He also argued that the broader opportunity in the sector may sit with smaller defence and drone companies, which could benefit from higher government spending and faster project execution.
That view comes against a stronger operational backdrop for HAL. ICICI Direct said the company’s order backlog stood at ₹2.7 lakh crore as of September 2025, giving it a substantial pipeline of work. The brokerage expects revenue growth to accelerate from FY27 onwards as execution improves on major contracts, including the Light Combat Aircraft Tejas Mk1A programme.
Execution had previously been held back by delays in GE-404 engine deliveries, but ICICI Direct said those supplies are now expected to resume, which should help HAL pick up the pace. The company is also widening its industrial partnerships: Collins Aerospace, an RTX business, has signed an agreement with HAL to set up a maintenance, repair and overhaul facility in Lucknow for key components used in the indigenous fighter programme. Together, the order book, resumed engine deliveries and new support arrangements are reinforcing the case for HAL, even as some market watchers look further down the defence supply chain for the next leg of the rally.
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