Jefferies stock recommendations for India: Hindustan Aeronautics Ltd (HAL) shares are among the multibagger stocks the Indian stock market has produced in the last few years. The defence stock has risen from around ₹699 to ₹4670 per share on the NSE in the last five years, clocking a rally of nearly 600%. In the early morning trade on Wednesday, HAL share price remained the bulls’ favourite despite a muted start and touched an intraday high of ₹4,695 per share on the NSE, logging an intraday gain of around 3%.
HAL share price | Jefferies gives ‘buy’ tag
However, the global brokerage Jefferies remains bullish on the PSU stock. Jefferies believes that the fast-approaching Tejas Mk1 deliveries are a positive fundamental development for the defence PSU. Taking this as a re-rating trigger for the HAL shares, Jefferies has given a ‘buy’ tag to HAL shares with a target price of ₹6,800 per share.
Why is Jefferies bullish on HAL shares?
Expecting a re-rating trigger from Tejas Mk1 deliveries, Jefferies said that HAL CMD Ravi Kota, in media interviews, post completing the delivery of the Tejas Mk1 trainer aircraft contract on 18 Sept 2026, was confident of delivering the Tejas Mk1A aircraft this year. CMD has historically been closely associated with India’s Light Combat Aircraft (LCA) program.
The HAL CMD has said in various media interactions that testing is underway to ensure requirements are in place for Tejas Mk1A deliveries to begin. 24 airframes are ready, with GE engines installed, and the aircraft have been tested. Hence, there is confidence in delivering 10 aircraft this year, which compares favourably to our assumption of 5 aircraft. HAL’s stock has de-rated, given delays in the Tejas Mk1A since CY24, and has raised investor concerns about the company’s execution ability. We believe that the Indian Air Force’s acceptance of even one aircraft will bolster confidence in the company’s abilities and be a key upside driver.
Jefferies stock recommendations India | HAL share price target
Giving a ‘buy’ ag to the HAL shares, Jefferies report said, “Our ₹6,800 PT (Price Target) values HAL at 35x PE Sept 28E, which is 33% below its peak multiple and a 13% discount to our target multiple for Bharat Electronics (BHE IN, Rs386, Buy). 1.8x rise in absolute profits over 4 years, 22%+ ROE and debt-free B/S with technology should drive upside. Downside risks: 1) execution delays in manufacturing, 2) defence indigenisation focus reduces.”
On reason for 43% upside HAL share price target prediction, Jefferies report said, “Tejas Mk1A is 43% of HAL’s order book and a key re-rating trigger for the stock. The company has received 10 engines for the aircraft from GE.”
Disclaimer: This story is for educational and informational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified financial experts before making any investment decisions.
