Hindustan Aeronautics (HAL) Q4 15/16 earnings summary

Executive summary

• FY2015-16 turnover reached a record ₹16,736.49 Cr, up 7.14% YoY; PBT rose 3.62% to ₹3,288.46 Cr, while PAT fell to ₹1,653.77 Cr.

• Production included 60 new aircraft and helicopters; provisional MoD performance rating remained “Excellent.”

Financial highlights

• Net revenue from operations was ₹16,919.45 Cr versus ₹15,730.03 Cr; total revenue was ₹18,498.28 Cr versus ₹17,372.44 Cr.

• PAT was ₹1,653.77 Cr versus ₹2,388.05 Cr; tax provision rose to ₹1,634.69 Cr from ₹784.47 Cr.

• Exports were ₹449.28 Cr versus ₹490.12 Cr; export order booking reached ₹447 Cr.

• Gross margin was ₹4,142.91 Cr versus ₹3,986.85 Cr; R&D expenditure was ₹1,182.28 Cr versus ₹1,042.43 Cr.

Outlook and guidance

• FY2016-17 defence capital expenditure allocation fell 8.72% from FY2015-16 budget estimates, posing a potential constraint on new acquisitions.

• Make in India, new procurement categories, partnerships and indigenisation initiatives were expected to support future opportunities while intensifying competition.

• Light helicopter, trainer, upgrade, UAV and engine programmes were positioned to support business expansion over the next 10–15 years.

• Plans included civil aircraft collaboration and two Do-228 civil demonstrators; R&D remained targeted at 10% of operating profit.