Shares of Hindustan Aeronautics Limited (HAL) soared to unprecedented heights on Friday, April 12th, reaching an all-time high of Rs 3,652 apiece on the Bombay Stock Exchange (BSE).
The surge came in the wake of news that the Defence Ministry had issued a monumental tender to HAL for the acquisition of 97 LCA Mark 1A fighter jets, expected to be valued at over Rs 65,000 crore.
This development marks a significant milestone in the indigenous defence manufacturing sector and is poised to be the largest order for indigenous military hardware ever placed by the Indian government.
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Over the past year, HAL’s shares have witnessed a remarkable ascent, surging by over 155 per cent, far outpacing the benchmark Nifty50 index, which recorded a modest 27 per cent rise during the same period.
The surge in HAL’s share price reflects investor optimism and confidence in the company’s prospects, fueled by the prospect of securing a landmark defence contract.
The tender issued by the Defence Ministry to HAL grants the public sector firm a three-month window to respond, signaling the government’s commitment to bolstering indigenous defence manufacturing capabilities and promoting self-reliance in the defence sector.
The procurement programme is aimed at modernizing the Indian Air Force’s fleet, particularly to replace aging aircraft such as the MiG-21s, MiG-23s, and MiG-27s, which are either being phased out or set to be phased out shortly.
Government officials have hailed the indigenous fighter aircraft programme as a major boost for promoting indigenization and stimulating growth in the domestic defence industry, particularly benefiting small and medium enterprises engaged in defence manufacturing across the country.
The decision to acquire 97 LCA Mark 1A fighter jets underscores the government’s commitment to enhancing indigenous defence capabilities and reducing dependency on imports.
The announcement of the tender follows Prime Minister Narendra Modi’s landmark sortie in the trainer variant of the indigenous fighter aircraft, marking the first-ever flight by a Prime Minister of India in a combat aircraft.
The programme to acquire 97 additional LCA Mark 1A fighter jets was first disclosed by Air Force Chief Air Chief Marshal VR Chaudhari, underscoring the Air Force’s commitment to bolstering its fleet with indigenous platforms.
HAL’s previous order for 83 LCA Mark 1A aircraft is nearing fruition, with the first aircraft slated for delivery in the coming weeks. The LCA Mark 1A represents an advanced version of the Tejas aircraft, boasting superior avionics and radar capabilities compared to its predecessors.
With indigenous content exceeding 65 per cent, the programme aligns closely with the government’s vision of Atmanirbhar Bharat (self-reliant India) and the Make in India initiative, showcasing India’s prowess in the aerospace sector.
In addition to the procurement of LCA Mark 1A fighter jets, HAL is also poised to secure contracts for over 200 LCA Mark 2s and a similar number of fifth-generation Advanced Medium Combat Aircraft, further bolstering India’s indigenous defence capabilities and positioning HAL as a key player in the nation’s defence manufacturing ecosystem.
As India continues its journey towards self-reliance and indigenization in defence, HAL’s stellar performance and future prospects remain a testament to the nation’s commitment to technological advancement and national security.
