Rs 1,89,300 Crore Order Book: Defence Company Bags Mega Order Worth Rs 62,370 Crore from Ministry of Defence

Ministry of Defence (MoD) signed a contract with Hindustan Aeronautics Limited (HAL) for the procurement of 97 Light Combat Aircraft (LCA) Mk1A, including 68 fighters and 29 twin-seaters, along with associated equipment, for the Indian Air Force, at a cost of over Rs 62,370 crore (excluding taxes). The delivery of these aircraft would commence during 2027-28 and be completed over a period of six years. 

The aircraft will have an indigenous content of over 64 per cent, with 67 additional items incorporated, over and above the previous LCA Mk1A contract signed in January 2021. The integration of advanced indigenously developed systems such as the UTTAM Active Electronically Scanned Array (AESA) Radar, Swayam Raksha Kavach and control surface actuators will further strengthen the Aatmanirbharta initiatives.

The project is being supported by a robust vendor base of nearly 105 Indian companies directly engaged in the manufacture of detailed components. The production is expected to generate close to 11,750 direct and indirect jobs per year for the duration of six years, giving a major boost to the domestic aerospace ecosystem.

The acquisition, under the ‘Buy (India-IDDM)’ category of Defence Acquisition Procedure 2020, is in line with the Government’s thrust on indigenisation. The LCA Mk1A is the most advanced variant of the indigenously designed & manufactured fighter aircraft and will serve as a potent platform to meet the operational requirements of the IAF.

Double the insights with one smart move — explore the Navratri offer now!

About the Company

Hindustan Aeronautics Ltd (HAL), a leading Indian defence company, excels in the design, manufacturing, repair and overhaul of aircraft and helicopters. Organised into three key segments—Manufacturing, Services and other activities—HAL boasts 20 production and overhaul divisions and nine R&D centres across India, prioritising indigenous programs like the HTT-40 Basic Trainer Aircraft and Light Utility Helicopter (LUH). Notably, HAL achieved the prestigious 'Maharatna' status on October 14, 2024, becoming the first Defence Public Sector Undertaking (PSU) to earn this distinction, signifying enhanced operational and financial autonomy.

According to Quarterly Results, the company reported net sales of Rs 4,819 crore and net profit of Rs 1,384 crore in Q1FY26. In its annual results, the net sales increased by 2 per cent to Rs 30,981 crore and net profit increased by 10 per cent to Rs 8,364 crore in FY25 compared to FY24.

The President of India’s portfolio owns the majority of the stake, i.e., 71.64 per cent as of June 2025 and DIIs increased their stake to 8.67 per cent in June 2025 compared to March 2025. The company has a market cap of over Rs 3 lakh crore and has maintained a healthy dividend payout of 31.4 per cent with a strong order book of Rs 1,89,300 crore. The stock gave multibagger returns of 315 per cent in 3 years and a whopping 1,150 per cent in 5 years.

Disclaimer: The article is for informational purposes only and not investment advice.