Hindustan Aeronautics Ltd (HAL) to Split Equity Shares in Upcoming Board Meeting
The Board of Hindustan Aeronautics Ltd (HAL) has scheduled a meeting on June 27 to discuss and approve a proposal regarding the subdivision of the company’s equity shares. In an official filing, HAL stated that the meeting of the Board of Directors will specifically focus on this proposal.
The purpose of a stock split is typically to enhance the stock’s liquidity within the market. On the designated record date, investors who retain the stock until that date will receive the newly created shares in their Demat accounts, while the stock price will be adjusted proportionately based on the split ratio.
Recently, HAL’s shares reached a 52-week high, experiencing a remarkable surge of almost 14% over the past five days. Since the beginning of this year, the stock has shown an upward trajectory of approximately 39%. By the end of Thursday, the shares closed 1.37% higher at Rs 3,536.
From a technical standpoint, the stock demonstrated a breakout from an ascending channel pattern on June 5, establishing a new all-time high of Rs 3,326.
Experts suggest that the above-average trading volume and the increase in future open interest observed in recent days indicate a positive sentiment among major market participants, favoring the bulls.
Jatin Gohil, Technical and Derivative Research Analyst at Reliance Securities, pointed out that the key moving averages are displaying an upward trend, signaling a bullish overall market direction. This positive momentum could potentially drive the stock towards its channel breakout point of Rs 3,800 in the short to medium term (1-3 months). In case of any downturn, the stock might find support around Rs 3,050, Gohil added.
Foreign institutional investors (FIIs) have consistently shown their confidence in HAL, as reflected by their increasing holdings over the past four quarters. As of the end of the March quarter, FIIs cumulatively held a 9.07% stake in the company.
Mutual funds have also been steadily increasing their stake in HAL. By the end of March, they held 8.84% of the company’s shares, compared to 6.05% in the December quarter of 2021.
Analysts maintain a positive outlook on HAL, citing its robust order book and promising revenue growth prospects. ICICI Securities reports that, among all the defense stocks it covers, HAL boasts the most impressive order funnel. The company’s order book for FY23 stands at Rs 81,700 crore, with potential order inflows of Rs 66,000 crore in FY24.
Hindustan Aeronautics Limited (HAL) is a renowned Indian aerospace and defense company that operates in the public sector. Its headquarters are located in Bangalore. HAL, founded on December 23, 1940, holds the distinction of being one of the world’s oldest and largest manufacturers in the aerospace and defense sectors.
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