Defence Ministry issues Rs 65,000 crore tender to HAL for buying 97 LCA Mark 1A fighter jets; shares hit all-time high

Hindustan Aeronautics HAL share price: Shares of Hindustan Aeronautics (HAL) hit an all-time high of Rs 3,652 apiece on the BSE on Friday, April 12, after news surfaced that the Defence Ministry issued a tender to the public sector firm Hindustan Aeronautics Limited for the purchase of made-in-India 97 LCA Mark 1A fighter jets expected to be worth over Rs 65,000 crore. In a year, shares of the company have jumped over 155 per cent, compared to around a 27 per cent rise in the benchmark Nifty50 index. 

This is set to be the largest order for indigenous military hardware ever placed by the Indian government.

The tender was issued by the Defence Ministry to the HAL recently, and they have been given three months to respond to it.

The programme will help the IAF replace its fleet of MiG-21s, MiG-23s, and MiG-27s, which have been either phased out or are set to be phased out shortly, government officials told ANI.

The indigenous fighter aircraft programme, fully backed by the Defence Ministry and Air Headquarters, is set to be a big boost for promoting indigenisation as well as give major business to the small and medium enterprises engaged in defence business across the country, they said.

Prime Minister Narendra Modi has been pushing for the revival of the HAL, which has bagged orders for building all types of indigenous fighter aircraft and helicopters, along with the engines for them, under his government.

The Prime Minister also undertook a sortie in the trainer variant of the indigenous fighter, which was the first ever sortie by the Prime Minister of India in any combat aircraft.

The plan to acquire 97 more LCA Mark 1A fighter jets was also announced first by Air Force Chief Air Chief Marshal VR Chaudhari on foreign soil in Spain when he told ANI about the mega plans to boost the indigenous fighter aircraft orders.

The decision to buy 97 more of these planes came around after the Air Chief held a review meeting of the indigenous fighter jet programme with all entities involved, including Hindustan Aeronautics Limited.

The last order for LCA Mark 1A was for 83 aircraft, and the first plane is poised to be delivered in a few weeks. LCA Mark 1A is the advanced version of the Tejas aircraft.

The LCA Mark 1A plane has more advanced avionics and radar than the initial 40 LCAs being supplied to the Air Force.

The indigenous content in the new LCA Mark1As is going to be more than 65 per cent.

The programme has been the harbinger of the Atmanirbhar Bharat and Make in India initiatives of the nation. More importantly, it is a flagbearer of India's self-reliance in the aerospace sector.

HAL is also set to bag deals for buying over 200 LCA Mark 2s and similar numbers of fifth-generation Advanced Medium Combat Aircraft.