HAL Q2 FY27: Profit Rises 16% to ₹1,936 Crore, Margins Slip

Hindustan Aeronautics Limited ( HAL ) reported a healthy Q2 FY27 performance. However, the stock remained range-bound as operating margins came in below expectations. Key Q2 FY27 Highlights - Revenue: ₹7,613 crore, up 14.9% YoY - Net profit: ₹1,936 crore, up 16% YoY - EBITDA: ₹1,739 crore, up 11.6% YoY - EBITDA margin: 22.8% versus 23.5% last year - Order book: Approximately ₹2.54 lakh crore - Near-term order pipeline: Around ₹90,000 crore over the next two years What Are Brokerages Saying? -Goldman Sachs: Maintained Buy with a target price of ₹5,870. Improving GE engine supplies and Tejas Mk1A deliveries are key growth catalysts. - Nuvama: Maintained Hold, highlighting execution challenges and the need for faster delivery ramp-up. - Citi: Maintained Buy with a target price of ₹6,175, citing improving execution readiness and growth opportunities. - JPMorgan: Maintained Overweight with a target price of ₹5,733, highlighting the large order book and improving engine supplies. Brokerage targets represent individual research estimates, not assured returns. My View HAL's long-term growth opportunity remains intact, supported by India's defence modernisation and its strong order pipeline. However, the market is increasingly looking for execution rather than just order-book growth. The biggest near-term catalyst is the delivery of Tejas Mk1A aircraft, where improving GE F404 engine supplies could help accelerate execution. At the same time, the 65-basis-point contraction in EBITDA margin deserves attention. I believe investors should track three things closely: Tejas delivery timelines, margin recovery and conversion of the order pipeline into executable contracts. A strong order book provides visibility, but timely execution and profitability will ultimately determine shareholder returns. Investors should also evaluate valuation before taking fresh positions.