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HAL IPO Review, Price, GMP (Hindustan Aeronautics Ltd)

Hindustan Aeronautics Limited IPO Review

Hindustan Aeronautics Limited (HAL) is a Bengaluru based Defence Public Sector Undertakings (DPSU) company. This company is engaged in the design, development, manufacture, repair, overhaul, upgrade and servicing of a wide range of products including, aircraft, helicopters, aero-engines, avionics, accessories, and aerospace structures. This is ‘Navratna’ company since June 2007 and the largest DPSU. HAL IPO will be open in the primary markets to applying to start from tomorrow, i.e, 16th March 2018. So I have checked the draft red herring prospectus of HAL and checked the issue price and GMP to present my Hindustan Aeronautics Limited IPO Review or HAL IPO Review for you.

About Hindustan Aeronautics Limited IPO :

  • IPO Opens on – March 16, 2018.
  • IPO Closes on – March 20, 2018.
  • Face Value – Rs. 10 Per Equity Share.
  • Issue Price – Rs. 1215 – Rs. 1240 Per Equity Share.
  • Issue Type – Book Built Issue IPO.
  • Retail Allocation – 35%
  • Market Lot – 12 Shares.
  • Minimum Order Quantity – 12 Shares.
  • Issue Size – 36,150,000 Equity Shares of Rs 10 aggregating up to Rs 4,482.60 Cr.
  • Offer for Sale – 36,150,000 Equity Shares of Rs 10 aggregating up to Rs [.] Cr.
  • Listing Exchange – BSE, NSE.
  • Draft Prospectus – Download.

Objectives of the HAL IPO:

  • To carry out the disinvestment of 36,150,000 equity shares by the selling shareholder constituting 10% of the company’s pre-Offer paid-up equity share capital the company.
  • To achieve the benefits of listing the equity shares on the Stock Exchanges.

About The Company –

  • Hindustan Aeronautics Limited is incorporated in 1963.
  • This is the 39th largest aerospace company in the world in terms of revenue.
  • This company has 20 production divisions and 11 R&D centers located across India and Indian Defense Services is the main customer of Hindustan Aeronautics Limited (HAL) and account for over 93% of sales.
  • Hindustan Aeronautics Limited (HAL) also sells its products and provide services to state governments, para-military forces and corporate.
  • The company’s experience of over 5 decades in research, design and development, manufacturing and maintenance, repair and overhaul services.
  • Hindustan Aeronautics Limited is an established track record in offering product life cycle support.
  • This company has 11 dedicated R&D Centres and the company owns one trademark, seven patents, six design registrations, and 44 copyrights.
  • Hindustan Aeronautics Limited has the largest Defence Public Sector Undertakings (DPSU) in terms of the value of production.
  • This company produced a diversified product portfolio which includes fighter aircraft, trainer aircraft, transport aircraft, a military helicopter, and civil helicopters and their engines, avionics, and accessories.
Hindustan Aeronautics Limited
HAL IPO Review

Promoters of the company :

  • Promoter of Hindustan Aeronautics Limited is the President of India, acting through the Department of Defence Production, Ministry of Defence.

Company Financials:

Hindustan Aeronautics Limited IPO

Hindustan Aeronautics Limited IPO Review OR HAL IPO Review:

HAL is an old name in memories of all Indians. It is the largest defense PSU of the country. The company has a solid background and financial results to attract investors. The current earnings per share for FY 2017 is at 73 and the return on the net worth ratio is at 21%. The grey market premium is quoting above Rs. 5 – Rs. 10 above the issue price. Historically dis-investment of Government companies has given massive returns to the investors. HAL will not be any different. Hence, our HAL IPO Review is POSITIVE on this initial public offering. Investors can invest in Hindustan Aeronautics Limited IPO for a long-term view.

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Top working executives from HAL wisely plan for establishing joint ventures and ensure their post retirement employment. This is nothing but kick backs. After retirement join these joint ventures . These joint ventures suck HAL profits by taking job contracts directly from customers. Their juniors in HAL will write(kick back) to customers expressing HALs inability and support for offloading the jobs to joints ventures.