Shares of Hindustan Aeronautics surged 8% to Rs 1,481.35 on the BSE in Wednesday’s intra-day trade amid reports that the company has signed a memorandum of understanding (MoU) with France-based aerospace engine firm Safran to extend cooperation and explore opportunities for new helicopter engines in the civil and military markets.

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“The company has entered into an MoU on a non-exclusive basis with Safran Helicopter Engines SAS, France, for finding the feasibility of potential cooperation w.r.t. business opportunities, which does not constitute any obligation on the part of either party to enter into any definitive agreement or make any financial commitments,” Hindustan Aeronautics Limited (HAL) said in a statement.

Therefore, the said transaction was not considered material for disclosure to the stock exchanges, HAL said today in a statement clarifying a media report.

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Over the past three months, the stock has outperformed the market by gaining 15%, against a 2.3% fall in the S&P BSE Sensex. In the past year, it has surged over 37% as compared to a 12% rise in the benchmark index. It had touched a record high of Rs 1,568 on October 18, 2021.

On Wednesday, the share closed 6.55% higher at Rs 1,465.95 on the Bombay Stock Exchange (BSE).

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In the first nine months of the financial year 2022 (9MFY22), HAL had posted a 23% year-on-year (YoY) jump in profit after tax at Rs 1,985 crore on strong operational performance. Revenue from operations rose 9% YoY to Rs 13,059 crore. EBITDA margin improved 232 basis points (bps) to 26.04% from 23.72% in the year-ago period. EBITDA stands for earnings before interest, taxes, depreciation and amortization.

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Hindustan Aeronautics is involved in the design, development, manufacturing, repair, overhaul, upgrades and servicing of a wide variety of products, including aircraft, helicopter, aero-engines, avionics, accessories and aerospace structures. The company was established on December 23, 1940, to meet the requirement of the Indian Defence Forces in the area of aerospace.

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Headquartered in Bengaluru, HAL’s business is largely focused on highly technology-intensive defence services. The company aims to expand operations in the domestic and international markets. In line with the “Atmanirbhar Bharat Abhiyan,” the company has been building an aerospace ecosystem in the country to boost the growth of the industry.