Bengaluru: Hindustan Aeronautics Limited has announced that CARE Ratings Limited has reaffirmed its credit ratings for the company’s bank facilities following a review of its operational and financial performance.
Ratings Reaffirmed
The reaffirmed rating covers long-term and short-term bank facilities, including both fund-based and non-fund-based limits such as cash credit, working capital demand loans, overdrafts, letters of credit, and bank guarantees. The facilities total Rs 6,050 crore and retain the highest long-term rating of CARE AAA with a Stable outlook, along with the short-term rating of CARE A1+.
Strategic Role in the Defence Sector
The rating agency highlighted HAL’s strategic importance to the Government of India as the country’s primary supplier of defence aviation equipment. The company maintains an integrated presence across the aviation value chain, covering design, development, manufacturing, maintenance and o,verhaul of aircraft and related systems used by India’s defence forces. The Government of India continues to hold a majority stake of 71.64 percent in the company, supporting HAL’s strong position within the aerospace and defence sector.
Strong Order Book and Revenue Visibility
CARE Ratings noted that HAL’s order book expanded significantly to Rs 258,942 crore as of September 30, 2025. This includes manufacturing orders valued at about Rs 224,486 crore for helicopters, aircraft, and engines, providing revenue visibility over the next seven to eight years. Additionally, the company maintains a repair, overhaul, and spares orderbook of Rs 30,569 crore, with further contributions from design and development projects and exports.
Financial Strength and Liquidity
The ratings also reflect HAL’s healthy operating performance and strong financial profile. Total operating income increased to Rs 30,146 crore in FY25, while profit before interest, lease rentals, depreciation, and tax margins remained strong at 29.19 percent. The company’s liquidity position remains robust, supported by free cash and cash equivalents of approximately Rs 43,465 crore as of September 30, 2025, and minimal reliance on external borrowings.
CARE Ratings maintained a Stable outlook on HAL, indicating expectations that the company will continue benefiting from its strategic importance to India’s defence sector and maintain a strong financial profile supported by healthy order inflows and operating performance.
Disclaimer: This article has been generated solely from the information contained in the provided rating communication and press release document and does not include verification or information from external sources.
