HAL share price tanked over 8% in early trade on Monday after a Tejas fighter jet crashed during a demonstration at the Dubai Air Show, 2025. The PSU defence stock declined as much as 8.48% to ₹4205.25 apiece on the BSE. However, on NSE, HAL share price fell as much as 4.13% to ₹4,405.00 apiece.
The Tejas fighter jet, built by Hindustan Aeronautics Ltd (HAL) for the Indian Air Force, crashed during an aerobatic display at low altitude and the pilot Wing Commander Namansh Syal lost his life. A Court of Inquiry by the IAF has been constituted to determine the exact cause of the accident.
Analysts believe that this incident does not indicate any structural issues with the Tejas programme, but it is likely to lead to short-term volatility in the HAL share price.
“An incident like this doesn’t change the long-term trajectory, but it does introduce short-term reputational risk, and investors typically move to reassess risk-reward when valuations are rich,” said Harshal Dasani, Business Head, INVasset PMS.
The government clarified that earlier concerns around oil leakage were unfounded and unrelated. However, the incident still places HAL under heightened scrutiny at a time when expectations are exceptionally high.
“HAL enters this phase with one of the strongest order books in the company’s history, including the recent mega order for 97 Tejas units and ongoing demand for helicopters and engines. But the stock was priced for perfection. Trading at elevated valuation multiples, the market was assuming flawless execution and uninterrupted momentum in India’s defence-manufacturing push,” said Dasani.
According to him, the long-term India defence story remains intact, but near-term volatility around HAL shares is justified until greater transparency emerges.
Choice Broking expects HAL’s long-term fundamentals to remain robust, supported by strong execution, established order visibility and continued strategic importance to India’s defence modernisation plans.
“In the wake of this event, while we recognise that sentiment around exports may see a temporary setback, we think the near-to-medium-term focus continues to be on domestic deliveries — particularly the ongoing production ramp-up for Tejas Mk1A. By the time export engagements scale up meaningfully, we expect the current situation to normalise and investor concerns to subside,” Choice Broking said.
Should you buy or sell HAL shares?
Choice Broking expects short-term volatility in HAL shares, but believes the broader programme remains firmly on track and aligned with India’s long-term defence capability goal.
The brokerage firm maintained its ‘Buy’ rating, with HAL share price target of ₹5,570 apiece, valuing the company at 35x FY27/28E average EPS.
At 9:35 AM, HAL share price was trading 2.81% lower at ₹4,465.70 apiece on the BSE.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.