Currently, Hindustan Aeronautics (HAL) shares are near their 52-week high, after the aerospace and defence company sealed a deal worth ₹ 6,800 crore with the defence ministry. The stock has potential to rally further, analysts suggest an estimate of 14% upside from the current levels. TRENDING STORIES See All Premium Diplomacy in times of cricket: A Motera Thursday with M . . . Premium With 9% dividend yield in FY23, this stock beats PPF, E . . . Premium CRPF women ‘daredevils’ embark on bike rally from Delhi . . . Premium ADIA nears buying $500 million stake in Lenskart, sources The defence sector has regained upward momentum after forming a higher base over past three-four months. Within the space, domestic brokerage house ICICI Direct says HAL has been the resilient candidate which has logged a resolute breakout from three months consolidation (2800-2300), indicating resumption of primary up trend. The brokerage, in a report, said it offers a fresh entry opportunity to ride the next leg of the up move. The brokerage has initiated a "Buy" action on Hindustan Aeronautics with a buying range between ₹ 2,785-2,835 and a target price of ₹ 3,240. This represents an upside of 14% and the time frame given is 3 months. Stop loss can be kept at ₹ 2,580. It expects the stock to accelerate upward momentum and head towards ₹ 3,240 as it is the implied target of past three month's consolidation (2800-2300). Fundamental outlook “HAL has a healthy order-book position of | 84000 crore as of December 2022 (3. 2x TTM revenues) led by large scale orders in manufacturing segment (Light Combat Aircraft Tejas MK1, HTT-40 Light Combat Helicopters, Advanced Light Helicopters) and engines," the brokerage said. MINT PREMIUM See All Premium Top performing midcap stocks of 2023 so far Premium When Parag Parikh's wife stepped up to help him become . . . Premium This Specialty Chemical Company is Taking a Leap in Lit . . . Premium Money lessons this shark learnt from her mother It expects HAL to deliver revenue and EBITDA CAGR of 10. 3% and 14. 8%, respectively, over FY22-25E. PAT is likely to grow at 12% CAGR over the same period. Increase in profitability with strong asset turnover is expected to result in healthy return ratios over FY23-25. “Key point to highlight is that the stock has formed a higher base above 100 day’s EMA and subsequently witnessed a faster pace of retracement wherein it retraced the preceding 10 week’s decline in just four weeks, highlighting the robust price structure," the report said. HAL shares touched a lifetime high of ₹ 2,887. 5 apiece on 8 March. On Thursday, the stock was trading 0. 70% lower at ₹ 2,843. 10 apiece on the NSE. The stock is up more than 112. 95% in a year's period. ABOUT THE AUTHOR Meghna Sen Meghna Sen is a deputy chief content producer at Livemint where she tracks companies, markets, news. She has 5+ years of experience with online and print publications. Email: meghna. sen@htdigital. in Read more from this author Know your inner investor Do you have the nerves of steel or do you get insomniac over your investments? Let’s define your investment approach. Take the test Catch all the Business News , Market News , Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates. More Less Topics Hindustan Aeronautics OPEN IN APP.