Hindustan Aeronautics has surged nearly 3% during early trading hours today. This upswing follows an announcement by the defence ministry regarding two lucrative contracts valued at Rs 8,073 crore, aimed at procuring 34 advanced light helicopters and associated equipment for the Indian Army and the Coast Guard.
HAL’s shares soared by more than 3% to reach Rs 3,136.70 on the BSE, marking a substantial increase from the previous day’s closing value of Rs 3,039.90. The market capitalization of HAL also witnessed a commendable climb, reaching Rs 2.08 lakh crore. Trading activity saw a turnover of Rs 19.14 crore, with 0.62 lakh shares changing hands.
This surge in HAL’s shares comes in the wake of the defence major achieving a 52-week high of Rs 3,428.75 on March 11, 2024, contrasting with its low of Rs 1,237.50 recorded on March 23, 2023. Analyzing the stock’s performance, the relative strength index (RSI) stood at 45.8, indicating that it is neither oversold nor overbought.
Highlighting the significance of these contracts, the Ministry of Defence emphasized that the acquisition of advanced light helicopters under the Indian-IDDM (Indigenously Designed, Developed, and Manufactured) category marks a crucial stride towards indigenous defence manufacturing.
These contracts, totaling Rs 8,073.17 crore, were signed with HAL on March 13, 2024, following approval from the Cabinet Committee on Security (CCS).
HAL’s statement outlined that the contracts involve the acquisition of 34 Advanced Light Helicopters (ALH) Dhruv Mk III, equipped with Operational Role Equipment, catering to the needs of the Indian Army (25 ALHs) and the Indian Coast Guard (9 ALHs).
Furthermore, the ministry highlighted the extensive employment opportunities generated by this project, estimated at 190 lakh man-hours, and the involvement of over 200 Micro, Small, and Medium Enterprises (MSMEs) along with 70 local vendors in the indigenization process.