HAL vs BEL: Latest broker targets ahead of Budget 2026

HAL vs BEL in focus as Budget 2026 nears

HAL and BEL have stayed on investor screens ahead of Union Budget 2026, with multiple broker notes flagging defence spending expectations and order pipeline visibility. Nomura India has reiterated its preference for Hindustan Aeronautics (HAL) as a top defence pick, while keeping a more cautious stance on Bharat Electronics (BEL). Domestic broker JM Financial has also initiated coverage on HAL with a buy call, arguing that recent price weakness has improved the risk-reward. Separately, market participants have tracked technical calls and sector notes from other brokerages as defence stocks react to budget headlines. The updates matter because HAL and BEL are often treated as bellwethers for defence manufacturing and defence electronics, respectively. And with procurement priorities expected to tilt towards domestic vendors, rating changes and target revisions are drawing attention.

Nomura’s stance: HAL preferred, BEL still a hold

Nomura India has said it prefers HAL over BEL among the two stocks, calling HAL its top defence sector stock pick. The foreign brokerage carries a Buy rating on HAL with a target of ₹6,040. Nomura’s earlier targets for HAL were ₹5,954 (April 2026), ₹6,000 (February 2026), ₹6,100 (May 2025) and ₹4,700 (February 2025).

For BEL, Nomura has a Hold rating and has retained a target of ₹454 per share. The note also highlights that Nomura has revised BEL’s target upward by almost 100% over the past two years, with its May 2024 target at ₹232. In other snippets cited, Nomura has also been referenced with HAL and BEL targets of ₹6,100 and ₹459, and separately with targets of ₹6,325 and ₹459 under an ‘Add’ rating framework, indicating multiple reports and revisions across time.

JM Financial initiates coverage on HAL after a sharp correction

JM Financial has initiated coverage on Hindustan Aeronautics with a Buy recommendation and a target price of ₹4,875. The brokerage said this target is based on roughly 29 times HAL’s average earnings since COVID, and it expects a strong future business pipeline. JM Financial also argued that the market may have already priced in key concerns after HAL’s stock fell 22% in six months, compared with an 8% decline in the Nifty over the same period.

As of April 10, 2026, HAL was quoted around ₹4,109, following the initiation note. The report positioned the correction as improving the near-term risk-reward rather than changing the longer-term demand drivers that are typically linked to defence ordering cycles.

Analyst consensus targets cited for HAL

Beyond JM Financial, the article references broader analyst consensus as optimistic on HAL, with average 12-month price targets in the ₹5,060 to ₹5,527 range. That range was presented as implying 27% to 37% upside from prevailing levels cited alongside the note. The spread reflects differences in assumptions around execution timelines, margins, and deliveries, which tend to vary by house.

While these are aggregated figures, they provide a useful reference for where the street sits on HAL relative to current trading prices mentioned in the article.

Budget 2026: defence allocation expectations keep PSUs active

Defence stocks such as BEL, Mazagon Dock Shipbuilding, HAL, Bharat Dynamics (BDL), Astra Microwave Products, Data Patterns (India) and Paras Defence and Space Technologies were described as likely to remain on investors’ radar on Budget day. Within defence PSUs, HAL was viewed as a beneficiary due to its aircraft and engine manufacturing pipeline. BEL was again framed as a proxy for defence electronics, radars and communication systems.

Nomura India has projected a high single-digit to 20% rise in the defence budget, with a larger share expected to be directed towards domestic procurement, modernisation, and research and development. Separately, Nirmal Bang said capital allocation could rise to ₹2.1 to ₹2.3 lakh crore (₹210,000 to ₹230,000 crore), implying a 20% to 30% year-on-year increase, with the share potentially moving closer to 30% of total defence spending.

Technical calls: BEL and HAL levels highlighted ahead of Budget

A technical view from Sachin Gupta of Choice Broking was cited as pointing to pre-Budget optimism and up to 12% upside in five shares based on charts. In the run-up, several defence names including BEL, HAL, GRSE, Data Patterns, Astra Microwave and Paras Defence were noted as gaining 1% to 3%.

Gupta’s strategy on BEL was a buy-on-dips call around ₹400 to ₹405, with a stop loss at ₹388, and upside targets of ₹420 and ₹435. For HAL, the note said the stock moved decisively above its 50-day EMA with rising volumes, signalling renewed buying interest. It also flagged support around ₹4,350 and suggested HAL could potentially deliver 8% to 12% returns in the short term, as per that technical view.

Motilal Oswal’s sector note: budget and order visibility

Motilal Oswal Financial Services issued a bullish view on HAL, BEL and BDL in a sectoral note dated December 8, 2025, citing order pipelines, a policy push for indigenisation, and multi-year revenue visibility. The note referenced India’s FY26 defence budget of ₹6.2 lakh crore (₹620,000 crore) and a capital outlay of ₹1.8 lakh crore (₹180,000 crore) focused on modernisation and domestic manufacturing.

Motilal Oswal projected 20% to 30% upside over the next 12 months for the trio, while also noting near-term supply chain hiccups. For HAL, it maintained a Buy rating with a target price of ₹5,500, implying 28% upside from ₹4,290. The note also cited Q2 FY26 EBITDA margins of 18.5% and a forecast 22% revenue CAGR through FY28.

Nomura’s growth assumptions cited in a separate HAL note

Another Nomura-linked excerpt said HAL management guided for 8% to 10% sales growth in FY26, which Nomura viewed as conservative. The brokerage said it expects a PAT CAGR of 20% over FY25 to FY28F and maintained a Buy rating with a target price of ₹6,100, described as 35 times one-year-forward earnings. HAL was cited as settling at ₹5,016.40 in that context, with the target implying about 21% potential upside.

The same set of excerpts also mentioned Nomura expecting a 59% CAGR in manufacturing revenues over FY25 to FY28F. These details were presented as part of the rationale tied to delivery processes and order book strength.

Key numbers at a glance

What these calls mean for investors tracking defence PSUs

Across the notes, HAL is consistently framed around platform manufacturing visibility and delivery execution, while BEL is positioned as an electronics and systems proxy. The gap in ratings, especially Nomura’s buy on HAL versus hold on BEL at one point, shows how brokerages are differentiating between platforms and electronics exposure within defence. At the same time, the presence of multiple targets for the same stock across different dates underlines that revisions can be frequent as order inflows, budget signals, and execution updates evolve.

For the broader sector, the budget focus is on how much of the total allocation is directed to capital expenditure and domestic procurement. The cited expectations, including capital allocation of ₹210,000 to ₹230,000 crore, also help explain why defence PSUs often see sharp pre-event moves and equally quick reversals when the final numbers differ from market positioning.

Conclusion

HAL and BEL remain central to the defence PSU trade ahead of Budget 2026, with Nomura’s preference tilted towards HAL and other brokers also highlighting valuation and technical triggers. The next clear catalyst remains the Budget announcement and subsequent clarity on procurement, modernisation, and R&D allocations, which will shape near-term sentiment across the defence stock basket.